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As filed with the Securities and Exchange Commission on June 30, 1999
Registration No. 333-80757
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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PRE-EFFECTIVE AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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Georgia-Pacific Corporation
(Exact name of Registrant as specified in its charter)
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GEORGIA 93-0432081
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
133 Peachtree Street, N.E.
Atlanta, GA 30303
(404) 652-4000
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
KENNETH F. KHOURY
Vice President, Deputy General Counsel and Secretary
GEORGIA-PACIFIC CORPORATION
133 Peachtree Street, N.E.
Atlanta, GA 30303
(404) 652-4000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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Copy to:
JOHN B. TEHAN
SIMPSON THACHER & BARTLETT
425 Lexington Avenue
New York, New York 10017
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Approximate date of commencement of proposed sale to public: From time to
time after the effective date of this Registration Statement, as determined in
light of market conditions.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any of the securities being registered in this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, please check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [X]
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(continued on following page)
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Pursuant to Rule 429 under the Securities Act of 1933, the Prospectus
contained in this Registration Statement and supplements to such Prospectus is
a combined Prospectus and also relates to up to $300,000,000 of unsold
securities registered under Registration Statement No. 333-61665 previously
filed with the Commission on Form S-3 and declared effective on August 24,
1998 and to $200,000,000 of unsold securities registered under Registration
Statement No. 333-01785 previously filed with the Commission on Form S-3 and
declared effective on March 22, 1996. This Registration Statement constitutes
post-effective Amendment No. 1 to Registration Statement No. 333-61665 and
post-effective Amendment No. 2 to Registration Statement No. 333-01785 and
such post-effective amendments shall hereafter become effective concurrently
with the effectiveness of this Registration Statement and in accordance with
Section 8(c) of the Securities Act of 1933. Upon the effectiveness of such
post-effective amendments, this Registration Statement, Registration Statement
No. 333-61665 and Registration Statement No. 333-01785 will relate to an
aggregate of $2,975,000,000 of Debt Securities, Preferred Stock, Georgia-
Pacific Corporation--Georgia-Pacific Group Common Stock, Georgia-Pacific Group
Rights to Purchase Series B Junior Preferred Stock, Georgia-Pacific
Corporation--Timber Group Common Stock, Timber Group Rights to Purchase Series
C Junior Preferred Stock, Warrants, Stock Purchase Contracts and Stock
Purchase Units.
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933, as amended, or until this
Registration Statement shall become effective on such date as the Securities
and Exchange Commission, acting pursuant to said Section 8(a), may determine.
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PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The Company estimates that expenses, other than underwriting compensation,
in connection with the offerings described in this Registration Statement will
be as follows:
<TABLE>
<S> <C>
Registration fee.............................................. $ 688,050
Trustees' fees and expenses................................... 50,000
Printing and engraving expenses............................... 170,000
Legal fees and expenses....................................... 300,000
Accounting fees and expenses.................................. 25,000
Rating agency fees............................................ 500,000
Blue Sky fees and expenses.................................... 10,000
Miscellaneous................................................. 10,000
----------
Total....................................................... $1,753,050
==========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Subsection (a) of Section 14-2-851 of the Georgia Business Corporation Code
provides that a corporation may indemnify or obligate itself to indemnify an
individual made a party to a proceeding because he is or was a director
against liability incurred in the proceeding if he acted in a manner he
believed in good faith to be in or not opposed to the best interests of the
corporation and, in the case of any criminal proceeding, he had no reasonable
cause to believe his conduct was unlawful. Subsection (d) of Section 14-2-851
of the Georgia Business Corporation Code provides that a corporation may not
indemnify a director in connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the corporation, or
in connection with any other proceeding in which he was adjudged liable on the
basis that personal benefit was improperly received by him. Notwithstanding
the foregoing, pursuant to Section 14-2-854 a court may order a corporation to
indemnify a director if such court determines the director is fairly and
reasonably entitled to indemnification in view of all the relevant
circumstances, whether or not such director met the standard of conduct set
forth in subsection (a) of Section 14-2-851 of the Georgia Business
Corporation Code or was adjudged liable as described in subsection (d) of
Section 14-2-851 of the Georgia Business Corporation Code.
Section 14-2-852 of the Georgia Business Corporation Code provides that to
the extent that a director has been successful, on the merits or otherwise, in
the defense of any proceeding to which he was a party, or in defense of any
claim, issue, or matter therein, because he is or was a director of the
corporation, the corporation shall indemnify the director against reasonable
expenses incurred by him in connection therewith.
Section 14-2-857 of the Georgia Business Corporation Code provides that an
officer of the corporation who is not a director is entitled to mandatory
indemnification under Section 14-2-852 and is entitled to apply for court
ordered indemnification under Section 14-2-854, in each case to the same
extent as a director. In addition, Section 14-2-857 provides that a
corporation may also indemnify an officer, employee or agent who is not a
director to the extent, consistent with public policy, that may be provided by
its articles of incorporation, bylaws, action of its board of directors or
contract.
In accordance with Article VI of the Company's Bylaws, every person (and
the heirs and personal representatives of such person) who is or was a
director, officer, employee or agent of the Company, or of any other
corporation, partnership, joint venture, trust or other enterprise in which he
served at the request of the Company, shall be indemnified by the Company
against all liability and expense (including, without limitation, counsel fees
and disbursements, and amounts of judgments, fines, penalties and amounts paid
in settlement by,
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a director, officer, employee or agent) actually and reasonably incurred by
him in connection with or resulting from any threatened, pending or completed
claim, action, suit or proceeding, whether civil, criminal, administrative or
investigative or in connection with any appeal relating thereto, in which he
may become involved, as a party or otherwise, or with which he may be
threatened, by reason of his being or having been a director, officer,
employee or agent of the Company or such other corporation, partnership, joint
venture, trust or other enterprise, or by reason of any action taken or
omitted by him in this capacity as such director, officer, employee or agent
whether or not he continues to be such at the time such liability or expense
shall have been incurred. Every such person (and the heirs and personal
representatives of such person), to the extent that such person has been
successful on the merits or otherwise with respect to any such claim, action,
matter, suit or proceeding is entitled to indemnification as of right for
expenses (including attorneys' fees) actually and reasonably incurred by him
in connection therewith. Except as provided in the preceding sentence, upon
receipt of a claim for indemnification under Article VI of the Company's
Bylaws, the Corporation shall proceed as follows: If the claim is made by a
director or officer of the Company, the Board of Directors, by a majority vote
of a quorum consisting of directors who were not parties to the applicable
action, suit or proceeding, shall determine whether the claimant met the
applicable standard of conduct as set forth in subsections (A) or (B) below.
If such quorum is not obtainable or, even if obtainable, a quorum of
disinterested directors so directs, such determination shall be made by
independent legal counsel (who may be the regular inside or outside counsel
for the Company) in written opinion. If such determination has not been made
within 90 days after the claim is asserted, the claimant shall have the right
to require that the determination be submitted to the shareholders at the next
regular meeting of shareholders by vote of a majority of the shares entitled
to vote thereon. If a claim is made by a person who is not a director or
officer of the Company, the Chief Executive Officer and the general counsel of
the Company shall determine, subject to applicable law, the manner in which
there shall be made the determination as to whether the claimant met the
applicable standard of conduct as set forth in subsections (A) and (B) below.
In the case of each claim for indemnification, the Company shall pay the claim
to the extent the determination is favorable to the person making the claim.
(A) In the case of a claim, action, suit or proceeding other than by or
in the right of the Company to procure a judgment in its favor, the
director, officer, employee or agent must have acted in a manner he
reasonably believed to be in or not opposed to the best interests of the
Company, and, in addition, in any criminal action or proceeding, had no
reasonable cause to believe that his conduct was unlawful. In addition, any
director seeking indemnification must not have been adjudged liable on the
basis that any personal benefit was received by him. For the purpose of
this subsection (A), the termination of any claim, action, suit or
proceeding, civil, criminal or administrative, by judgment, order,
settlement (either with or without court approval) or conviction, or upon a
plea of guilty or nolo contendere or its equivalent, shall not create a
presumption that a director, officer, employee or agent did not meet the
standards of conduct set forth in this Subsection.
(B) In the case of a claim, action, suit or proceeding by or in the
right of the Company to procure a judgment in its favor, the director,
officer, employee or agent must have acted in good faith in a manner he
reasonably believed to be in or not opposed to the best interests of the
Company, provided, however, that no indemnification under this subsection
(B) shall be made (1) with regard to any claim, issue or matter as to which
such director, officer, employee or agent shall have been adjudged to be
liable to the Company unless and only to the extent that the court in which
such action or suit was brought shall determine that, despite the
adjudication of liability but in view of all the circumstances of the case,
such director, officer, employee or agent is fairly and reasonably entitled
to indemnity for such expenses which the court shall deem proper, or (2)
for amounts paid, or expenses incurred, in connection with the defense or
settlement of any such claim, action, suit or proceeding, unless a court of
competent jurisdiction has approved indemnification with regard to such
amounts or expenses.
Pursuant to Article VI of the Company's Bylaws, expenses incurred by any
person who is or was a director, officer, employee or agent of the Company
with respect to any claim, action, suit or proceeding of the character
described in the first sentence of the preceding paragraph shall be advanced
by the Company prior to
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the final disposition thereof upon receipt of an undertaking by or on behalf
of the recipient to repay such amount if it shall be ultimately determined
that he is not entitled to indemnification. Indemnification and advancement of
expenses pursuant to Article VI of the Company's Bylaws is not exclusive of
any rights to which any such director, officer, employee or other person may
otherwise be entitled by contract or by law.
The Company carries insurance policies insuring its liability to officers
and directors under the foregoing indemnity and insuring its officers and
directors against liability incurred in their capacity as such.
Any underwriter who may become a party to the proposed form of Underwriting
Agreement, filed as Exhibit 1 to this Registration Statement, will agree to
indemnify the directors of the Company and each officer who signs this
Registration Statement against certain liabilities, including liabilities
under the Securities Act of 1933, to the extent specified therein.
ITEM 16. EXHIBITS
<TABLE>
<C> <S>
1(a) Form of Underwriting Agreement (filed as Exhibit 1 to the Company's
Registration Statement
No. 33-43453 and incorporated herein by this reference thereto).
4(a) Indenture, dated as of March 1, 1983, between Georgia-Pacific
Corporation and The Chase Manhattan Bank (National Association), as
Trustee, relating to the Senior Debt Securities (filed as Exhibit
4.4(i) to the Company's Annual Report on Form 10-K for the year ended
December 31, 1996 (File No. 1-3506) and incorporated herein by this
reference thereto).
4(b) First Supplemental Indenture, dated as of July 27, 1988, among
Georgia-Pacific Corporation, The Chase Manhattan Bank (National
Association), as Trustee, and Morgan Guaranty Trust Company of New
York, as successor Trustee (filed as Exhibit 4.4(ii) to the Company's
Annual Report on Form 10-K for the year ended December 31, 1996 (File
No. 1-3506), and incorporated herein by this reference thereto).
4(c) Agreement of Resignation, Appointment and Acceptance dated as of
January 31, 1992 by and among Georgia-Pacific Corporation, Morgan
Guaranty Trust Company of New York, as Trustee, and The Bank of New
York, as Successor Trustee (filed as Exhibit 4.4(iii) to the Company's
Annual Report on Form 10-K for the year ended December 31, 1996, File
No. 1-3506, and incorporated herein by this reference thereto.)
4(d) Form of Senior Debt Securities (included in Article Two of Exhibit
4(a)).
4(e) Credit Agreement, dated as of December 23, 1996, among Georgia-Pacific
Corporation, as borrower, the lenders named therein, and Bank of
America National Trust and Savings Association, as agent (filed as
Exhibit 4.1(i) to the Company's Annual Report on Form 10-K for the
year ended December 31, 1996 (File No. 1-3506), and incorporated
herein by this reference thereto).
4(f) In reliance upon Item 601(b)(4)(iii) of Regulation S-K, various
instruments defining the rights of holders of long-term debt of the
Company are not being filed herewith because the total of securities
authorized under each such instrument does not exceed 10% of the total
assets of the Company. The Company hereby agrees to furnish a copy of
any such instrument to the Commission upon request.
***4(g) Form of Indenture between Georgia-Pacific Corporation and The Bank of
New York, as Trustee, relating to the Subordinated Debt Securities.
</TABLE>
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<TABLE>
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4(h) Form of Subordinated Debt Securities (included in Article Two of
Exhibit 4(g)).
*4(i) Form of Articles Supplementary relating to each series of Preferred
Stock (to be filed in connection with the offering of each series of
Preferred Stock).
*4(j) Form of Preferred Stock share certificate.
*4(k) Form of Articles Supplementary relating to each series of Junior
Preferred Stock (to be filed in connection with the offering of each
series of Junior Preferred Stock).
*4(l) Form of Junior Preferred Stock share certificate.
4(m) Form of Georgia-Pacific Corporation--Georgia-Pacific Group Common
Stock share certificate (filed as Exhibit 4 to the Company's
Registration Statement on Form 8-A relating to File No. 333-35813,
and incorporated herein by this reference thereto).
4(n) Form of Georgia-Pacific Corporation--Timber Group Common Stock share
certificate (filed as Exhibit 5 to the Company's Registration
Statement on Form 8-A relating to File No. 333-35813, and
incorporated herein by this reference thereto).
*4(o) Form of Warrant Agreement.
4(p) Form of Purchase Contract Agreement relating to Stock Purchase
Contracts and Stock Purchase Units.
4(q) Form of Pledge Agreement for Stock Purchase Contracts and Stock
Purchase Units.
4(r) Restated Articles of Incorporation of the Company (filed as Exhibit
3.2 to the Company's Registration Statement on Form S-4 (File No.
333-35813), and incorporated herein by this reference thereto).
4(s) Bylaws of the Company (filed as Exhibit 3.2 to the Company's
Quarterly Report on Form 10-Q for the quarter ended April 3, 1999
(File No. 1-3506), and incorporated herein by this reference
thereto).
4(t) Restated Rights Agreement, dated as of December 16, 1997, between
Georgia-Pacific Corporation and First Chicago Trust Company of New
York, with Form of Georgia-Pacific Group Rights Certificate attached
as Exhibit A-1, Form of Timber Group Rights Certificate attached as
Exhibit A-2, Series B Junior Preferred Stock Designation attached as
Exhibit B-1 and Series C Junior Preferred Stock Designation attached
as Exhibit B-2 (filed as Exhibit 8 to the Company's Registration
Statement on Form 8-A relating to File No. 333-35813, and
incorporated by reference thereto).
4(u) Form of Remarketing Agreement between Georgia-Pacific Corporation and
Morgan Stanley & Co. Incorporated.
4(v) Form of Stock Purchase Units (included as Exhibits A and B of Exhibit
4(p)).
4(w) Credit Agreement, dated as of June 30, 1999, among Georgia-Pacific
Corporation, the Lenders named therein and Morgan Stanley Senior
Funding, Inc., as Agent for the Lenders and as Lead Arranger and Book
Manager.
***5(a) Opinion of Simpson Thacher & Bartlett.
***5(b) Opinion of Troutman Sanders LLP.
***12 Statement re: Computation of Ratio of Earnings to Fixed Charges.
***23(a) Consent of Arthur Andersen LLP.
23(b) Consent of Simpson Thacher & Bartlett (included in exhibit 5).
23(c) Consent of Troutman Sanders LLP (included in exhibit 5).
24 Powers of Attorney included in signature page.
25 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Bank of New York (incorporated by reference
to exhibit 4.4(iii) from the Registrant's Annual Report on Form 10-K
for the year ended December 31, 1996 (Commission File No. 1-3506)
filed with the Securities and Exchange Commission).
</TABLE>
- --------
* To be filed subsequent to the effectiveness of this Registration Statement
by an amendment to the Registration Statement or incorporated by reference
pursuant to a Current Report on Form 8-K in connection with the offering of
Securities.
** To be filed prior to effectiveness by amendment.
*** Previously filed.
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ITEM 17. UNDERTAKINGS.
(a)The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made
of the securities registered hereby, a post-effective amendment to this
registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if
the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the
registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") that are
incorporated by reference in this registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement shall be deemed to be
a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the provisions described under Item 15, or
otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication
of such issue.
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(d) The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act,
the information omitted from the form of prospectus filed as part of this
registration statement in reliance on Rule 430A and contained in a form of
prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this Pre-
Effective Amendment No. 2 to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Atlanta,
State of Georgia, on June 30, 1999.
GEORGIA-PACIFIC CORPORATION
By: /s/ John F. McGovern
-----------------------------------
John F. McGovern
Executive Vice President--Finance
and Chief Financial Officer
The undersigned Directors and Officers of Georgia-Pacific Corporation
hereby appoint A.D. Correll, James F. Kelley and Kenneth F. Khoury, and each
of them, as attorneys-in-fact for the undersigned, with full power of
substitution and resubstitution for, and in the name, place and stead of the
undersigned, to sign and file with the Securities and Exchange Commission
under the Securities Act of 1933, as amended, any and all amendments
(including post-effective amendments) and exhibits to this Registration
Statement and any and all applications and other documents to be filed with
the Securities and Exchange Commission pertaining to the registration of the
securities covered hereby, with full power and authority to do and perform
each and every act and thing requisite and necessary or desirable, hereby
ratifying and confirming all that said attorneys-in-fact, or either of them,
or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this Pre-
Effective Amendment No. 2 to the Registration Statement on Form S-3 has been
signed on June 30, 1999 by the following persons in the capacities indicated.
Signature Title
--------- -----
/s/ A.D. Correll Director, Chairman, Chief
- --------------------------------- Executive Officer and
A.D. Correll President (principal
executive officer)
/s/ John F. McGovern Executive Vice President--
- --------------------------------- Finance and Chief
John F. McGovern Financial Officer
(principal financial
officer)
/s/ James E. Terrell Vice President and
- --------------------------------- Controller (principal
James E. Terrell accounting officer)
/s/ * Director
- ---------------------------------
James S. Balloun
/s/ * Director
- ---------------------------------
Robert Carswell
/s/ * Director
- ---------------------------------
Jane Evans
/s/ * Director
- ---------------------------------
Donald V. Fites
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Signature Title
--------- -----
/s/ * Director
- ---------------------------------
Harvey C. Fruehauf, Jr.
/s/ * Director
- ---------------------------------
Richard V. Giordana
/s/ * Director
- ---------------------------------
David R. Goode
/s/ * Director
- ---------------------------------
M. Douglas Ivester
/s/ * Director
- ---------------------------------
Louis W. Sullivan
/s/ * Director
- ---------------------------------
James B. Williams
By:/s/ James F. Kelley Director
- ---------------------------------
James F. Kelley
As Attorney-in-Fact for the
Directors or Officers by whose
names an asterisk appears.
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EXHIBIT 4(p)
------------
================================================================================
GEORGIA-PACIFIC CORPORATION
and
THE FIRST NATIONAL BANK OF CHICAGO,
as Purchase Contract Agent
----------------------
PURCHASE CONTRACT AGREEMENT
Dated as of July 7, 1999
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
RECITALS............................................................... 1
ARTICLE I Definitions and Other Provisions of General Applications
Section 1.1. Definitions........................................... 1
Section 1.2. Compliance Certificates and Opinions.................. 11
Section 1.3. Form of Documents Delivered to Purchase Contract Agent 12
Section 1.4. Acts of Holders; Record Dates......................... 12
Section 1.5. Notices............................................... 14
Section 1.6. Notice to Holders; Waiver............................. 15
Section 1.7. Effect of Headings and Table of Contents.............. 15
Section 1.8. Successors and Assigns................................ 15
Section 1.9. Separability Clause................................... 15
Section 1.10. Benefits of Agreement................................. 15
Section 1.11. Governing Law......................................... 16
Section 1.12. Legal Holidays........................................ 16
Section 1.13. Counterparts.......................................... 16
Section 1.14. Inspection of Agreement............................... 16
ARTICLE II Certificate Forms
Section 2.1. Forms of Certificates Generally....................... 16
Section 2.2. Form of Purchase Contract Agent's Certificate of
Authentication........................................ 18
ARTICLE III The Securities
Section 3.1. Amount; Form and Denominations........................ 18
Section 3.2. Rights and Obligations Evidenced by the Certificates.. 18
Section 3.3. Execution, Authentication, Delivery and Dating........ 19
Section 3.4. Temporary Certificates................................ 20
Section 3.5. Registration; Registration of Transfer and Exchange... 20
Section 3.6. Book-Entry Interests.................................. 22
Section 3.7. Notices to Holders.................................... 22
Section 3.8. Appointment of Successor Clearing Agency.............. 22
Section 3.9. Definitive Certificates............................... 22
Section 3.10. Mutilated, Destroyed, Lost and Stolen Certificates.... 23
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Section 3.11. Persons Deemed Owners................................. 24
Section 3.12. Cancellation.......................................... 24
Section 3.13. Creation of Treasury PEPS Units by Substitution of
Treasury Securities................................... 25
Section 3.14. Reestablishment of PEPS Units......................... 26
Section 3.15. Transfer of Collateral upon Occurrence of
Termination Event..................................... 27
Section 3.16. No Consent to Assumption.............................. 28
ARTICLE IV The Senior Deferrable Notes
Section 4.1. Interest Payments; Rights to Interest Payments
Preserved............................................. 28
Section 4.2 Deferral of Interest Payments......................... 29
Section 4.3. Interest Rate Reset; Notice Relating to Cash
Settlement............................................ 29
Section 4.4. Notice and Voting..................................... 30
ARTICLE V The Purchase Contracts
Section 5.1. Purchase of Shares of Georgia-Pacific Group Stock..... 30
Section 5.2. Purchase Contract Payments............................ 33
Section 5.3. Deferral of Purchase Contract Payments................ 33
Section 5.4. Payment of Purchase Price............................. 34
Section 5.5. Issuance of Shares of Georgia-Pacific Group Stock..... 37
Section 5.6. Adjustment of Settlement Rate......................... 38
Section 5.7. Notice of Adjustments and Certain Other Events........ 45
Section 5.8. Termination Event; Notice............................. 45
Section 5.9. Early Settlement...................................... 46
Section 5.10. Acceleration of Purchase Contract Settlement Date..... 48
Section 5.11. No Fractional Shares.................................. 51
Section 5.12. Charges and Taxes..................................... 51
ARTICLE VI Remedies
Section 6.1. Unconditional Right of Holders to Receive
Purchase Contract Payments and to Purchase
Shares of Georgia-Pacific Group Stock................. 51
Section 6.2. Restoration of Rights and Remedies.................... 52
Section 6.3. Rights and Remedies Cumulative........................ 52
Section 6.4. Delay or Omission Not Waiver.......................... 52
Section 6.5. Undertaking for Costs................................. 52
Section 6.6. Waiver of Stay or Extension Laws...................... 53
ARTICLE VII The Purchase Contract Agent
<PAGE>
Section 7.1. Certain Duties and Responsibilities.................. 53
Section 7.2. Notice of Default.................................... 54
Section 7.3. Certain Rights of Purchase Contract Agent............ 54
Section 7.4. Not Responsible for Recitals or Issuance of
Securities........................................... 55
Section 7.5. May Hold Securities.................................. 55
Section 7.6. Money Held in Custody................................ 55
Section 7.7. Compensation and Reimbursement....................... 56
Section 7.8. Corporate Purchase Contract Agent Required;
Eligibility.......................................... 56
Section 7.9. Resignation and Removal; Appointment of
Successor............................................ 57
Section 7.10. Acceptance of Appointment by Successor............... 58
Section 7.11. Merger, Conversion, Consolidation or
Succession to Business............................... 58
Section 7.12. Preservation of Information; Communications to
Holders.............................................. 59
Section 7.13. No Obligations of Purchase Contract Agent............ 59
Section 7.14. Tax Compliance....................................... 59
ARTICLE VIII Supplemental Agreements
Section 8.1. Supplemental Agreements Without Consent of Holders... 60
Section 8.2. Supplemental Agreements With Consent of Holders...... 61
Section 8.3. Execution of Supplemental Agreements................. 62
Section 8.4. Effect of Supplemental Agreements.................... 62
Section 8.5. Reference to Supplemental Agreements................. 62
ARTICLE IX Merger, Consolidation, Share exchange, Sale or Conveyance
Section 9.1. Covenant Not to Merge, Consolidate, Enter into
a Share Exchange, Sell or Convey Property
Except Under Certain Conditions...................... 62
Section 9.2. Rights and Duties of Successor Corporation........... 63
Section 9.3. Officers' Certificate and Opinion of Counsel
Given to Purchase Contract Agent..................... 63
ARTICLE X Covenants
Section 10.1. Performance Under Purchase Contracts................. 64
Section 10.2. Maintenance of Office or Agency...................... 64
Section 10.3. Company to Reserve Georgia-Pacific Group Stock....... 64
Section 10.4. Covenants as to Georgia-Pacific Group Stock.......... 65
Section 10.5. Statements of Officers of the Company as to Default.. 65
Section 10.6. ERISA................................................ 65
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EXHIBITS
EXHIBIT A Form of PEPS Units Certificate
EXHIBIT B Form of Treasury PEPS Units Certificate
EXHIBIT C Instruction to Purchase Contract Agent
EXHIBIT D Notice from Purchase Contract Agent to Holders (Transfer of
Collateral upon Occurrence of a Termination Event)
EXHIBIT E Notice to Settle by Cash
EXHIBIT F Notice from Purchase Contract Agent to Collateral Agent and
Senior Trustee (Settlement of Purchase Contract through
Remarketing)
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<PAGE>
PURCHASE CONTRACT AGREEMENT, dated as of July 7, 1999, between GEORGIA-
PACIFIC CORPORATION, a Georgia corporation (the "Company"), and THE FIRST
NATIONAL BANK OF CHICAGO, a national banking association, acting as purchase
contract agent for the Holders of Securities from time to time (the "Purchase
Contract Agent").
RECITALS
The Company has duly authorized the execution and delivery of this
Agreement and the Certificates evidencing the Securities.
All things necessary to make the Purchase Contracts, when the Certificates
are executed by the Company and authenticated, executed on behalf of the Holders
and delivered by the Purchase Contract Agent, as provided in this Agreement, the
valid obligations of the Company, and to constitute these presents a valid
agreement of the Company, in accordance with its terms, have been done.
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually agreed as follows:
ARTICLE I
Definitions and Other Provisions
of General Applications
Section I.1. Definitions.
For all purposes of this Agreement, except as otherwise expressly provided
or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them in
this Article and include the plural as well as the singular, and nouns and
pronouns of the masculine gender include the feminine and neuter genders;
(b) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles in
the United States;
(c) the words "herein," "hereof" and "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular Article,
Section, Exhibit or other subdivision;
(d) the following terms have the meanings given to them in this Section
1.1(d):
"Act" has the meaning, with respect to any Holder, set forth in
Section 1.4.
<PAGE>
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Agreement" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions
hereof.
"Applicable Market Value" has the meaning set forth in Section 5.1.
"applicants" has the meaning set forth in Section 7.12(b).
"Bankruptcy Code" means title 11 of the United States Code, or any
other law of the United States that from time to time provides a uniform
system of bankruptcy laws.
"Beneficial Owner" means, with respect to a Global Certificate, a
Person who is the beneficial owner of such Book-Entry Interest as reflected
on the books of the Clearing Agency or on the books of a Person maintaining
an account with such Clearing Agency (directly as a Clearing Agency
Participant or as an indirect participant, in each case in accordance with
the rules of such Clearing Agency).
"Board of Directors" means the board of directors of the Company or a
duly authorized committee of that board.
"Board Resolution" means one or more resolutions of the Board of
Directors, a copy of which has been certified by the Secretary or an
Assistant Secretary of the Company, to have been duly adopted by the Board
of Directors and to be in full force and effect on the date of such
certification and delivered to the Purchase Contract Agent.
"Book-Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 3.6.
"Business Day" means any day other than a Saturday or Sunday or a day
on which banking institutions in New York City are authorized or required
by law or executive order to remain closed or a day on which the Senior
Trustee is closed for business; provided that for purposes of the second
paragraph of Section 1.12 only, the term "Business Day" shall also be
deemed to exclude any day on which trading on the New York Stock Exchange,
Inc. is closed or suspended.
"Cash Settlement" has the meaning set forth in Section 5.4(a)(i).
<PAGE>
"Certificate" means a PEPS Units Certificate or a Treasury PEPS Units
Certificate.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as a
depositary for the Securities and in whose name, or in the name of a
nominee of that organization, shall be registered a Global Certificate and
which shall undertake to effect book entry transfers and pledges of the
Securities.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the
Clearing Agency effects book entry transfers and pledges of securities
deposited with the Clearing Agency.
"Closing Price" has the meaning set forth in Section 5.1.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" has the meaning set forth in Section 1 of the Pledge
Agreement.
"Collateral Account" has the meaning set forth in Section 1 of the
Pledge Agreement.
"Collateral Agent" means The Chase Manhattan Bank, as Collateral Agent
under the Pledge Agreement until a successor Collateral Agent shall have
become such pursuant to the applicable provisions of the Pledge Agreement,
and thereafter "Collateral Agent" shall mean the Person who is then the
Collateral Agent thereunder.
"Collateral Substitution" has the meaning set forth in Section 3.13.
"Common Stock" means the Georgia-Pacific Group Stock and the Georgia-
Pacific Corporation--Timber Group Common Stock, par value $.80 per share,
of the Company.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such
pursuant to the applicable provision of this Agreement, and thereafter
"Company" shall mean such successor.
"Constituent Person" has the meaning set forth in Section 5.6(b).
"Convertible Securities" has the meaning set forth in Section F of
Article V of the Restated Articles of Incorporation of the Company.
"Corporate Trust Office" means the principal corporate trust office of
the Purchase Contract Agent at which, at any particular time, its corporate
trust business shall
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<PAGE>
be administered, which office at the date hereof is located at The First
National Bank of Chicago, One First National Plaza, Suite 0126, Chicago,
Illinois 60670-0126, Attention: Global Corporate Trust Services.
"Coupon Rate" means the percentage rate per annum at which each Senior
Deferrable Note will bear interest initially.
"Current Market Price" has the meaning set forth in Section 5.6(a)(8).
"Depositary" means DTC until another Clearing Agency becomes its
successor.
"Disposition" has the meaning set forth in Section 5.10(a)(i).
"DTC" means The Depository Trust Company, the initial Clearing Agency.
"Early Settlement" has the meaning set forth in Section 5.9(a).
"Early Settlement Amount" has the meaning set forth in Section 5.9(a).
"Early Settlement Date" has the meaning set forth in Section 5.9(a).
"Early Settlement Rate" has the meaning set forth in Section 5.9(b).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time, and
the rules and regulations promulgated thereunder.
"Expiration Date" has the meaning set forth in Section 1.4(e).
"Expiration Time" has the meaning set forth in Section 5.6(a)(6).
"Extension Period" has the meaning set forth in Section 4.2.
"Failed Remarketing" has the meaning set forth in Section 5.4(b).
"Fair Value" has the meaning set forth in Section F of Article V of
the Restated Articles of Incorporation of the Company.
"Georgia-Pacific Group Stock" means the Georgia-Pacific Corporation--
Georgia-Pacific Group Common Stock, par value $.80 per share, of the
Company.
"Georgia-Pacific Group Subsidiaries" has the meaning set forth in
Section 5.10(b).
4
<PAGE>
"Global Certificate" means a Certificate that evidences all or part of
the Securities and is registered in the name of a Clearing Agency or a
nominee thereof.
"Holder" means, with respect to a Security, the Person in whose name
the Security evidenced by a PEPS Units Certificate or a Treasury PEPS Units
Certificate is registered in the related PEPS Units Register or the
Treasury PEPS Units Register, as the case may be; provided, however, that
in determining whether the Holders of the requisite number of PEPS Units or
Treasury PEPS Units have voted on any matter, then for the purpose of such
determination only (and not for any other purpose hereunder), if the
Security remains in the form of one or more Global Certificates and if the
Clearing Agency which is the holder of such Global Certificate has sent an
omnibus proxy assigning voting rights to the Clearing Agency Participants
to whose accounts the Securities are credited on the record date, the term
"Holder" shall mean such Clearing Agency Participant acting at the
direction of the Beneficial Owners.
"Indenture" means the Indenture, dated as of March 1, 1983, between
the Company and The Chase Manhattan Bank (National Association), as
Trustee, as amended and supplemented (including any provisions of the TIA
that are deemed incorporated therein) by the First Supplemental Indenture
to the Indenture, dated July 27, 1988, among Georgia-Pacific Corporation,
The Chase Manhattan Bank (National Association), as Trustee, and Morgan
Guaranty Trust Company of New York, as Successor Trustee, and by the
Agreement of Resignation, Appointment and Acceptance, dated as of
January 31, 1992, by and among Georgia-Pacific Corporation, Morgan Guaranty
Trust Company of New York, as Trustee, and The Bank of New York, as
Successor Trustee, pursuant to which the Senior Deferrable Notes will be
issued.
"Issuer Order" or "Issuer Request" means a written order or request
signed in the name of the Company by its Chairman of the Board, its
President or one of its Vice Presidents, and by its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the
Purchase Contract Agent.
"Net Proceeds" has the meaning set forth in Section F of Article V of
the Restated Articles of Incorporation of the Company.
"non-electing share" has the meaning set forth in Section 5.6(b).
"NYSE" has the meaning set forth in Section 5.1.
"Officers' Certificate" means a certificate signed by (i) either the
Chairman, Chief Executive Officer and President or Executive Vice
President--Finance and Chief Financial Officer and (ii) either the Vice
President and Treasurer or the Vice President, Deputy General Counsel and
Secretary, of the Company, and delivered to the Purchase Contract Agent.
Any Officers' Certificate delivered with respect to compliance with a
condition or covenant provided for in this Agreement shall include:
5
<PAGE>
(1) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(2) a brief statement of the nature and scope of the examination
or investigation undertaken by each officer in rendering the Officers'
Certificate;
(3) a statement that each such officer has made such examination
or investigation as, in such officer's opinion, is necessary to enable
such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel to the Company (and who may be an employee of the Company), and who
shall be reasonably acceptable to the Purchase Contract Agent. An opinion
of counsel may rely on certificates as to matters of fact.
"Outstanding Securities" means, with respect to any PEPS Units or
Treasury PEPS Units and as of the date of determination, all PEPS Units or
Treasury PEPS Units evidenced by Certificates theretofore authenticated,
executed and delivered under this Agreement, except:
(1) If a Termination Event has occurred, (i) Treasury PEPS Units
and (ii) PEPS Units for which the underlying Senior Deferrable Notes
have been theretofore deposited with the Purchase Contract Agent in
trust for the Holders of such PEPS Units;
(2) PEPS Units and Treasury PEPS Units evidenced by Certificates
theretofore cancelled by the Purchase Contract Agent or delivered to
the Purchase Contract Agent for cancellation or deemed cancelled
pursuant to the provisions of this Agreement; and
(3) PEPS Units and Treasury PEPS Units evidenced by Certificates
in exchange for or in lieu of which other Certificates have been
authenticated, executed on behalf of the Holder and delivered pursuant
to this Agreement, other than any such Certificate in respect of which
there shall have been presented to the Purchase Contract Agent proof
satisfactory to it that such Certificate is held by a bona fide
purchaser in whose hands the PEPS Units or Treasury PEPS Units
evidenced by such Certificate are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
number of the PEPS Units or Treasury PEPS Units have given any request,
demand, authorization,
6
<PAGE>
direction, notice, consent or waiver hereunder, PEPS Units or Treasury PEPS
Units owned by the Company or any Affiliate of the Company shall be
disregarded and deemed not to be Outstanding Securities, except that, in
determining whether the Purchase Contract Agent shall be protected in
relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only PEPS Units or Treasury PEPS Units which a
Responsible Officer of the Purchase Contract Agent knows to be so owned
shall be so disregarded. PEPS Units or Treasury PEPS Units so owned which
have been pledged in good faith may be regarded as Outstanding Securities
if the pledgee establishes to the satisfaction of the Purchase Contract
Agent the pledgee's right so to act with respect to such PEPS Units or
Treasury PEPS Units and that the pledgee is not the Company or any
Affiliate of the Company.
"Payment Date" means each February 16, May 16, August 16 and
November 16, commencing November 16, 1999.
"PEPS Unit" means the collective rights and obligations of a Holder of
a PEPS Units Certificate in respect of the Senior Deferrable Note, subject
to the Pledge thereof, and the related Purchase Contract.
"PEPS Units Certificate" means a certificate evidencing the rights and
obligations of a Holder in respect of the number of PEPS Units specified on
such certificate.
"PEPS Units Register" and "PEPS Units Registrar" have the respective
meanings set forth in Section 3.5.
"Permitted Investments" has the meaning set forth in Section 1 of the
Pledge Agreement.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint-stock company,
limited liability company, trust, unincorporated organization or government
or any agency or political subdivision thereof or any other entity of
whatever nature.
"Plan" means an employee benefit plan that is subject to ERISA, a plan
or individual retirement account that is subject to Section 4975 of the
Code or any entity whose assets are considered assets of any such plan.
"Pledge" means the pledge under the Pledge Agreement of the Senior
Deferrable Notes or the Treasury Securities, in either case constituting a
part of the Securities.
"Pledge Agreement" means the Pledge Agreement, dated as of July 7,
1999, among the Company, the Collateral Agent, the Securities Intermediary
and the Purchase Contract Agent, on its own behalf and as attorney-in-fact
for the Holders from time to time of the Securities.
7
<PAGE>
"Pledged Senior Deferrable Notes" has the meaning set forth in Section
1 of the Pledge Agreement.
"Predecessor Certificate" means a Predecessor PEPS Units Certificate
or a Predecessor Treasury PEPS Units Certificate.
"Predecessor PEPS Units Certificate" of any particular PEPS Units
Certificate means every previous PEPS Units Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under
the PEPS Units evidenced thereby; and, for the purposes of this definition,
any PEPS Units Certificate authenticated and delivered under Section 3.10
in exchange for or in lieu of a mutilated, destroyed, lost or stolen PEPS
Units Certificate shall be deemed to evidence the same rights and
obligations of the Company and the Holder as the mutilated, destroyed, lost
or stolen PEPS Units Certificate.
"Predecessor Treasury PEPS Units Certificate" of any particular
Treasury PEPS Units Certificate means every previous Treasury PEPS Units
Certificate evidencing all or a portion of the rights and obligations of
the Company and the Holder under the Treasury PEPS Units evidenced thereby;
and, for the purposes of this definition, any Treasury PEPS Units
Certificate authenticated and delivered under Section 3.10 in exchange for
or in lieu of a mutilated, destroyed, lost or stolen Treasury PEPS Units
Certificate shall be deemed to evidence the same rights and obligations of
the Company and the Holder as the mutilated, destroyed, lost or stolen
Treasury PEPS Units Certificate.
"Proceeds" has the meaning set forth in Section 1 of the Pledge
Agreement.
"Purchase Contract" means, with respect to any Security, the contract
forming a part of such Security and obligating the Company to (i) sell, and
the Holder of such Security to purchase, shares of Georgia-Pacific Group
Stock and (ii) pay the Holder Purchase Contract Payments on the terms and
subject to the conditions set forth in Article Five hereof.
"Purchase Contract Agent" means the Person named as the "Purchase
Contract Agent" in the first paragraph of this agreement until a successor
Purchase Contract Agent shall have become such pursuant to the applicable
provisions of this Agreement, and thereafter "Purchase Contract Agent"
shall mean such Person.
"Purchase Contract Payments" means the payments payable by the Company
on the Payment Dates in respect of each Purchase Contract, equal to .% per
annum of the Stated Amount.
"Purchase Contract Settlement Date" means the earlier of (1)
August 16, 2002; (2) the fifth Business Day immediately preceding the
Redemption Date, if any, or (3) the fifth Business Day immediately
preceding the Spin-Off Date, if any.
8
<PAGE>
"Purchase Contract Settlement Fund" has the meaning set forth in
Section 5.5.
"Purchase Price" has the meaning set forth in Section 5.1.
"Purchased Shares" has the meaning set forth in Section 5.6(a)(6).
"Record Date" for the Purchase Contract Payments payable on any
Payment Date means, as to any Global Certificate, the Business Day next
preceding such Payment Date, and as to any other Certificate, the fifteenth
Business Day prior to such Payment Date.
"Redemption" has the meaning set forth in Section 5.10(a)(i)
"Redemption Date" has the meaning set forth in Section 5.10(a)(i).
"Reference Price" has the meaning set forth in Section 5.1.
"Register" means the PEPS Units Register and the Treasury PEPS Units
Register.
"Registrar" means the PEPS Units Registrar and the Treasury PEPS Units
Registrar.
"Related Business Transaction" has the meaning set forth in Section F
of Article V of the Restated Articles of Incorporation of the Company.
"Remarketing" has the meaning set forth in the Senior Deferrable Notes
Board Resolutions.
"Remarketing Agent" has the meaning set forth in Section 5.4(b).
"Remarketing Agreement" means the Remarketing Agreement, dated as of
July 7, 1999, between the Company and the Remarketing Agent.
"Remarketing Fee" has the meaning set forth in Section 5.4(b).
"Reorganization Event" has the meaning set forth in Section 5.6(b).
"Reset Rate" has the meaning set forth in the Senior Deferrable Notes
Board Resolutions.
"Responsible Officer" means, with respect to the Purchase Contract
Agent, any officer of the Purchase Contract Agent assigned by the Purchase
Contract Agent to administer its corporate trust matters.
"Securities Intermediary" means The Chase Manhattan Bank, as
Securities Intermediary under the Pledge Agreement until a successor
Securities Intermediary shall
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<PAGE>
have become such pursuant to the applicable provisions of the Pledge
Agreement, and thereafter "Securities Intermediary" shall mean such
successor.
"Security" means a PEPS Unit or a Treasury PEPS Unit, as the case may
be.
"Senior Deferrable Notes" means the Senior Deferrable Notes issued
under the Indenture, each bearing interest, payable on the Payment Dates,
at the Coupon Rate until the Purchase Contract Settlement Date, and at the
Reset Rate thereafter.
"Senior Deferrable Notes Board Resolutions" means the resolutions duly
adopted by the Board on June ., 1999 relating to the Senior Deferrable
Notes.
"Senior Trustee" means The Bank of New York, a New York State banking
corporation, as trustee under the Indenture, or any successor thereto.
"Settlement Rate" has the meaning set forth in Section 5.1.
"Spin-Off Date" has the meaning set forth in Section 5.10(b).
"Stated Amount" means $50.
"Stated Maturity" means, with respect to the Senior Deferrable Notes,
August 16, 2004.
"Termination Date" means the date, if any, on which a Termination
Event occurs.
"Termination Event" means the occurrence of any of the following
events:
(1) at any time on or prior to the Purchase Contract Settlement Date,
a judgment, decree or court order shall have been entered granting relief
under the Bankruptcy Code, adjudicating the Company to be insolvent, or
approving as properly filed a petition seeking reorganization or
liquidation of the Company or any other similar applicable Federal or State
law, and, unless such judgment, decree or order shall have been entered
within 60 days prior to the Purchase Contract Settlement Date, such decree
or order shall have continued undischarged and unstayed for a period of 60
days;
(2) a judgment, decree or court order for the appointment of a
receiver or liquidator or trustee or assignee in bankruptcy or insolvency
of the Company or of its property, or for the termination or liquidation of
its affairs, shall have been entered, and, unless such judgment, decree or
order shall have been entered within 60 days prior to the Purchase Contract
Settlement Date, such judgment, decree or order shall have continued
undischarged and unstayed for a period of 60 days; or
(3) at any time on or prior to the Purchase Contract Settlement Date,
the Company shall file a petition for relief under the Bankruptcy Code, or
shall consent to the
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filing of a bankruptcy proceeding against it, or shall file a petition or
answer or consent seeking reorganization or liquidation under the
Bankruptcy Code or any other similar applicable Federal or State law, or
shall consent to the filing of any such petition, or shall consent to the
appointment of a receiver or liquidator or trustee or assignee in
bankruptcy or insolvency of it or of its property, or shall make an
assignment for the benefit of creditors, or shall admit in writing its
inability to pay its debts generally as they become due.
"Threshold Appreciation Price" has the meaning set forth in Section
5.1.
"TIA" means the Trust Indenture Act of 1939, as amended from time to
time, or any successor legislation.
"Trading Day" has the meaning set forth in Section 5.1.
"Treasury PEPS Unit" means, following the substitution of Treasury
Securities for the Senior Deferrable Note as collateral to secure a
Holder's obligations under the Purchase Contract, the collective rights and
obligations of a Holder of a Treasury PEPS Units Certificate in respect of
such Treasury Securities, subject to the Pledge thereof, and the related
Purchase Contract.
"Treasury PEPS Units Certificate" means a certificate evidencing the
rights and obligations of a Holder in respect of the number of Treasury
PEPS Units specified on such certificate.
"Treasury PEPS Units Register" and "Treasury PEPS Units Registrar"
have the respective meanings set forth in Section 3.5.
"Treasury Securities" means zero-coupon U.S. Treasury Securities
(Cusip No. 912820BE6) which are the principal strip of the .% U.S. Treasury
Securities which mature on August 15, 2002.
"Underwriting Agreement" means the Underwriting Agreement, dated
June 30, 1999, between the Company and Morgan Stanley & Co. Incorporated,
Goldman, Sachs & Co., PaineWebber Incorporated and Salomon Smith Barney
Inc.
Section I.2. Compliance Certificates and Opinions.
Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Purchase Contract Agent to take any
action in accordance with any provision of this Agreement, the Company shall
furnish to the Purchase Contract Agent an Officers' Certificate stating that all
conditions precedent, if any, provided for in this Agreement relating to the
proposed action have been complied with and, if requested by the Purchase
Contract Agent, an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent, if any, have been complied with, except
that in the case of any such
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application or request as to which the furnishing of such documents is
specifically required by any provision of this Agreement relating to such
particular application or request, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Agreement shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he or
she has made such examination or investigation as is necessary to enable
such individual to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
Section I.3. Form of Documents Delivered to Purchase Contract Agent.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.
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Section I.4. Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Agreement to be given or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent duly appointed in writing;
and, except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Purchase
Contract Agent and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Agreement and (subject to Section 7.1) conclusive in favor of the Purchase
Contract Agent and the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such instrument
or writing may be proved in any manner which the Purchase Contract Agent deems
sufficient.
(c) The ownership of Securities shall be proved by the PEPS Units Register
or the Treasury PEPS Units Register, as the case may be.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Certificate shall bind every future Holder of
the same Certificate and the Holder of every Certificate issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Purchase
Contract Agent or the Company in reliance thereon, whether or not notation of
such action is made upon such Certificate.
(e) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities entitled to give, make or take
any request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Agreement to be given, made or taken by
Holders of Securities. If any record date is set pursuant to this paragraph,
the Holders of the Outstanding PEPS Units and the Outstanding Treasury PEPS
Units, as the case may be, on such record date, and no other Holders, shall be
entitled to take the relevant action with respect to the PEPS Units or the
Treasury PEPS Units, as the case may be, whether or not such Holders remain
Holders after such record date; provided that no such action shall be effective
hereunder unless taken prior to or on the applicable Expiration Date by Holders
of the requisite number of Outstanding Securities on such record date. Nothing
contained in this paragraph shall be construed to prevent the Company from
setting a new record date for any action for which a record date has previously
been set pursuant to this paragraph (whereupon the record date previously set
shall automatically and with no action by any Person be cancelled and be of no
effect), and nothing contained in this paragraph shall be construed to render
ineffective any action taken by Holders of the requisite number of Outstanding
Securities on the date such action is taken. Promptly after any record date is
set pursuant to this paragraph, the Company, at its own expense, shall cause
notice of such record date, the proposed action by
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Holders and the applicable Expiration Date to be given to the Purchase Contract
Agent in writing and to each Holder of Securities in the manner set forth in
Section 1.6.
With respect to any record date set pursuant to this Section, the Company
may designate any date as the "Expiration Date" and from time to time may change
the Expiration Date to any earlier or later day; provided that no such change
shall be effective unless notice of the proposed new Expiration Date is given to
the Purchase Contract Agent in writing, and to each Holder of Securities in the
manner set forth in Section 1.6, prior to or on the existing Expiration Date.
If an Expiration Date is not designated with respect to any record date set
pursuant to this Section, the Company shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
Section I.5. Notices.
Any notice or communication is duly given if in writing and delivered in
Person or mailed by first-class mail (registered or certified, return receipt
requested), telecopier (with receipt confirmed) or overnight air courier
guaranteeing next day delivery, to the others' address; provided that notice
shall be deemed given to the Purchase Contract Agent only upon receipt thereof:
If to the Purchase Contract Agent:
The First National Bank of Chicago
One First National Plaza
Suite 0126
Chicago, Illinois 60670-0126
Telecopier No.: (312) 407-1708
Attention: Global Corporate Trust Services
If to the Company:
Georgia-Pacific Corporation
133 Peachtree Street, N.E.
Atlanta, Georgia 30303
Telecopier No.: (404) 230-1674
Attention: .
If to the Collateral Agent:
The Chase Manhattan Bank
450 West 33rd Street, 15th Floor
New York, New York 10001-2697
Telecopier No.: (212) 946-8154
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Attention: Corporate Trust Department
If to the Senior Trustee:
The Bank of New York
101 Barclay Street
New York, New York 10286
Telecopier No.: .
Attention: .
Section I.6. Notice to Holders; Waiver.
Where this Agreement provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at its address as it appears in the applicable Register, not
later than the latest date, and not earlier than the earliest date, prescribed
for the giving of such notice. In any case where notice to Holders is given by
mail, neither the failure to mail such notice, nor any defect in any notice so
mailed to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Agreement provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Purchase Contract Agent, but such filing shall not be a condition precedent to
the validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to give such notice by mail, then such
notification as shall be made with the approval of the Purchase Contract Agent
shall constitute a sufficient notification for every purpose hereunder.
Section I.7. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
Section I.8. Successors and Assigns.
All covenants and agreements in this Agreement by the Company shall bind
its successors and assigns, whether so expressed or not.
Section I.9. Separability Clause.
In case any provision in this Agreement or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof and thereof shall not in any way be affected or
impaired thereby.
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Section I.10. Benefits of Agreement.
Nothing contained in this Agreement or in the Securities, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and, to the extent provided hereby, the Holders, any
benefits or any legal or equitable right, remedy or claim under this Agreement.
The Holders from time to time shall be beneficiaries of this Agreement and shall
be bound by all of the terms and conditions hereof and of the Securities
evidenced by their Certificates by their acceptance of delivery of such
Certificates.
Section I.11. Governing Law.
This Agreement and the Securities shall be governed by, and construed in
accordance with, the laws of the State of New York.
Section I.12. Legal Holidays.
In any case where any Payment Date shall not be a Business Day,
notwithstanding any other provision of this Agreement or the PEPS Units
Certificates or the Treasury PEPS Units Certificates, Purchase Contract Payments
shall not be made on such date, but shall be made on the next succeeding
Business Day with the same force and effect as if made on such Payment Date,
provided that no interest shall accrue or be payable by the Company or any
Holder for the period from and after any such Payment Date, except that, if such
next succeeding Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day with the same
force and effect as if made on such Payment Date.
In any case where any Purchase Contract Settlement Date shall not be a
Business Day, notwithstanding any other provision of this Agreement, the PEPS
Units Certificates or the Treasury PEPS Units Certificates, the Purchase
Contracts shall not be performed on such date, but the Purchase Contracts shall
be performed on the immediately following Business Day with the same force and
effect as if performed on the Purchase Contract Settlement Date.
Section I.13. Counterparts.
This Agreement may be executed in any number of counterparts by the parties
hereto on separate counterparts, each of which, when so executed and delivered,
shall be deemed an original, but all such counterparts shall together constitute
one and the same instrument.
Section I.14. Inspection of Agreement.
A copy of this Agreement shall be available at all reasonable times during
normal business hours at the Corporate Trust Office for inspection by any Holder
or Beneficial Owner.
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ARTICLE II
Certificate Forms
Section II.1. Forms of Certificates Generally.
The PEPS Units Certificates (including the form of Purchase Contract
forming part of each PEPS Unit evidenced thereby) shall be in substantially the
form set forth in Exhibit A hereto, with such letters, numbers or other marks of
identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the PEPS Units are listed or any depositary
therefor, or as may, consistently herewith, be determined by the officers of the
Company executing such PEPS Units Certificates, as evidenced by their execution
of the PEPS Units Certificates.
The definitive PEPS Units Certificates shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers of the Company executing the PEPS Units evidenced
by such PEPS Units Certificates, consistent with the provisions of this
Agreement, as evidenced by their execution thereof.
The Treasury PEPS Units Certificates (including the form of Purchase
Contract forming part of each Treasury PEPS Unit evidenced thereby) shall be in
substantially the form set forth in Exhibit B hereto, with such letters, numbers
or other marks of identification or designation and such legends or endorsements
printed, lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Treasury PEPS Units may be listed or any
depositary therefor, or as may, consistently herewith, be determined by the
officers of the Company executing such Treasury PEPS Units Certificates, as
evidenced by their execution of the Treasury PEPS Units Certificates.
The definitive Treasury PEPS Units Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers of the Company executing the
Treasury PEPS Units evidenced by such Treasury PEPS Units Certificates,
consistent with the provisions of this Agreement, as evidenced by their
execution thereof.
Every Global Certificate authenticated, executed on behalf of the Holders
and delivered hereunder shall bear a legend in substantially the following form:
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN
THE NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE
"DEPOSITARY"), OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS
EXCHANGEABLE FOR CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN
THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED
IN THE PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS
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CERTIFICATE (OTHER THAN A TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY
TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED
EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REQUESTED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS REGISTERED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND
ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN."
Section II.2. Form of Purchase Contract Agent's Certificate of Authentication.
The form of the Purchase Contract Agent's certificate of authentication of
the PEPS Units shall be in substantially the form set forth on the form of the
PEPS Units Certificates.
The form of the Purchase Contract Agent's certificate of authentication of
the Treasury PEPS Units shall be in substantially the form set forth on the form
of the Treasury PEPS Units Certificates.
ARTICLE III
The Securities
Section III.1. Amount; Form and Denominations.
The aggregate number of Securities evidenced by Certificates authenticated,
executed on behalf of the Holders and delivered hereunder is limited to
17,250,000 (including 2,250,000 relating to the Underwriters' over-allotment
option), except for Certificates authenticated, executed and delivered upon
registration of transfer of, in exchange for, or in lieu of, other Certificates
pursuant to Section 3.4, 3.5, 3.10, 3.13, 3.14, 5.9 or 8.5.
The Certificates shall be issuable only in registered form and only in
denominations of a single PEPS Unit or Treasury PEPS Unit and any integral
multiple thereof.
Section III.2. Rights and Obligations Evidenced by the Certificates.
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Each PEPS Units Certificate shall evidence the number of PEPS Units
specified therein, with each such PEPS Unit representing (1) the ownership by
the Holder thereof of a beneficial interest in one Senior Deferrable Note,
subject to the Pledge of such Senior Deferrable Note by such Holder pursuant to
the Pledge Agreement, and (2) the rights and obligations of the Holder thereof
and the Company under one Purchase Contract. The Purchase Contract Agent as
attorney-in-fact for, and on behalf of, the Holder of each PEPS Unit shall
pledge, pursuant to the Pledge Agreement, the Senior Deferrable Note, forming a
part of such PEPS Unit, to the Collateral Agent and grant to the Collateral
Agent a security interest in the right, title and interest of such Holder in
such Senior Deferrable Note for the benefit of the Company, to secure the
obligation of the Holder under each Purchase Contract to purchase shares of
Georgia-Pacific Group Stock. Prior to the purchase of shares of Georgia-Pacific
Group Stock under each Purchase Contract, such Purchase Contracts shall not
entitle the Holder of a PEPS Units Certificate to any of the rights of a holder
of shares of Georgia-Pacific Group Stock, including, without limitation, the
right to vote or receive any dividends or other payments or to consent or to
receive notice as a shareholder in respect of the meetings of shareholders or
for the election of directors of the Company or for any other matter, or any
other rights whatsoever as a shareholder of the Company.
Upon the formation of a Treasury PEPS Unit pursuant to Section 3.13, each
Treasury PEPS Units Certificate shall evidence the number of Treasury PEPS Units
specified therein, with each such Treasury PEPS Unit representing (1) the
ownership by the Holder thereof of a 1/20 undivided beneficial interest in a
Treasury Security with a principal amount equal to $1,000, subject to the Pledge
of such Treasury Security by such Holder pursuant to the Pledge Agreement, and
(2) the rights and obligations of the Holder thereof and the Company under one
Purchase Contract. Prior to the purchase of shares of Georgia-Pacific Group
Stock under each Purchase Contract, such Purchase Contracts shall not entitle
the Holder of a Treasury PEPS Units Certificate to any of the rights of a holder
of shares of Georgia-Pacific Group Stock, including, without limitation, the
right to vote or receive any dividends or other payments or to consent or to
receive notice as a shareholder in respect of the meetings of shareholders or
for the election of directors of the Company or for any other matter, or any
other rights whatsoever as a shareholder of the Company.
Section III.3. Execution, Authentication, Delivery and Dating.
Subject to the provisions of Sections 3.13 and 3.14 hereof, upon the
execution and delivery of this Agreement, and at any time and from time to time
thereafter, the Company may deliver Certificates executed by the Company to the
Purchase Contract Agent for authentication, execution on behalf of the Holders
and delivery, together with its Issuer Order for authentication of such
Certificates, and the Purchase Contract Agent in accordance with such Issuer
Order shall authenticate, execute on behalf of the Holders and deliver such
Certificates.
The Certificates shall be executed on behalf of the Company by (1) either
the Chairman, Chief Executive Officer and President or the Executive Vice
President--Finance and Chief Financial Officer and (ii) the Vice President and
Treasurer or the Vice President, Deputy General Counsel and Secretary, of the
Company. The signature of any of these officers on the Certificates may be
manual or facsimile.
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Certificates bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates.
No Purchase Contract evidenced by a Certificate shall be valid until such
Certificate has been executed on behalf of the Holder by the manual signature of
an authorized signatory of the Purchase Contract Agent, as such Holder's
attorney-in-fact. Such signature by an authorized signatory of the Purchase
Contract Agent shall be conclusive evidence that the Holder of such Certificate
has entered into the Purchase Contracts evidenced by such Certificate.
Each Certificate shall be dated the date of its authentication.
No Certificate shall be entitled to any benefit under this Agreement or be
valid or obligatory for any purpose unless there appears on such Certificate a
certificate of authentication substantially in the form provided for herein
executed by an authorized signatory of the Purchase Contract Agent by manual
signature, and such certificate upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder.
Section III.4. Temporary Certificates.
Pending the preparation of definitive Certificates, the Company shall
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall authenticate, execute on behalf of the Holders, and deliver, in lieu
of such definitive Certificates, temporary Certificates which are in
substantially the form set forth in Exhibit A or Exhibit B hereto, as the case
may be, with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or engraved
thereon as may be required by the rules of any securities exchange on which the
PEPS Units or Treasury PEPS Units, as the case may be, are listed, or as may,
consistently herewith, be determined by the officers of the Company executing
such Certificates, as evidenced by their execution of the Certificates.
If temporary Certificates are issued, the Company will cause definitive
Certificates to be prepared without unreasonable delay. After the preparation
of definitive Certificates, the temporary Certificates shall be exchangeable for
definitive Certificates upon surrender of the temporary Certificates at the
Corporate Trust Office, at the expense of the Company and without charge to the
Holder. Upon surrender for cancellation of any one or more temporary
Certificates, the Company shall execute and deliver to the Purchase Contract
Agent, and the Purchase Contract Agent shall authenticate, execute on behalf of
the Holder, and deliver in exchange therefor, one or more definitive
Certificates of like tenor and denominations and evidencing a like number of
PEPS Units or Treasury PEPS Units, as the case may be, as the temporary
Certificate or Certificates so surrendered. Until so exchanged, the temporary
Certificates shall in all respects evidence the same benefits and the same
obligations with respect to the PEPS Units or Treasury PEPS Units, as the case
may be, evidenced thereby as definitive Certificates.
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Section III.5. Registration; Registration of Transfer and Exchange.
The Purchase Contract Agent shall keep at the Corporate Trust Office a
register (the "PEPS Units Register") in which, subject to such reasonable
regulations as it may prescribe, the Purchase Contract Agent shall provide for
the registration of PEPS Units Certificates and of transfers of PEPS Units
Certificates (the Purchase Contract Agent, in such capacity, the "PEPS Units
Registrar") and a register (the "Treasury PEPS Units Register") in which,
subject to such reasonable regulations as it may prescribe, the Purchase
Contract Agent shall provide for the registration of the Treasury PEPS Units
Certificates and of transfers of Treasury PEPS Units Certificates (the Purchase
Contract Agent, in such capacity, the "Treasury PEPS Units Registrar").
Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office, the Company shall execute and deliver to the Purchase
Contract Agent, and the Purchase Contract Agent shall authenticate, execute on
behalf of the designated transferee or transferees, and deliver, in the name of
the designated transferee or transferees, one or more new Certificates of any
authorized denominations, like tenor, and evidencing a like number of PEPS Units
or Treasury PEPS Units, as the case may be.
At the option of the Holder, Certificates may be exchanged for other
Certificates, of any authorized denominations and evidencing a like number of
PEPS Units or Treasury PEPS Units, as the case may be, upon surrender of the
Certificates to be exchanged at the Corporate Trust Office. Whenever any
Certificates are so surrendered for exchange, the Company shall execute and
deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall
authenticate, execute on behalf of the Holder, and deliver the Certificates
which the Holder making the exchange is entitled to receive.
All Certificates issued upon any registration of transfer or exchange of a
Certificate shall evidence the ownership of the same number of PEPS Units or
Treasury PEPS Units, as the case may be, and be entitled to the same benefits
and subject to the same obligations, under this Agreement as the PEPS Units or
Treasury PEPS Units, as the case may be, evidenced by the Certificate
surrendered upon such registration of transfer or exchange.
Every Certificate presented or surrendered for registration of transfer or
exchange shall (if so required by the Purchase Contract Agent) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Purchase Contract Agent duly executed, by the Holder thereof
or its attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of a Certificate, but the Company and the Purchase Contract Agent may
require payment from the Holder of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Certificates, other than any exchanges pursuant to
Sections 3.6 and 8.5 not involving any transfer.
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Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall not be obligated to authenticate, execute on behalf of the Holder
and deliver any Certificate in exchange for any other Certificate presented or
surrendered for registration of transfer or for exchange on or after the
Business Day immediately preceding the earlier of the Purchase Contract
Settlement Date or the Termination Date. In lieu of delivery of a new
Certificate, upon satisfaction of the applicable conditions specified above in
this Section and receipt of appropriate registration or transfer instructions
from such Holder, the Purchase Contract Agent shall:
(1) if the Purchase Contract Settlement Date has occurred, deliver the
shares of Georgia-Pacific Group Stock issuable in respect of the Purchase
Contracts forming a part of the Securities evidenced by such other
Certificate; or
(2) if a Termination Event shall have occurred prior to the Purchase
Contract Settlement Date, transfer the Senior Deferrable Notes or the
Treasury Securities, as the case may be, evidenced thereby, in each case
subject to the applicable conditions and in accordance with the applicable
provisions of Article Five hereof.
Section III.6. Book-Entry Interests.
The Certificates, on original issuance, will be issued in the form of one
or more fully registered Global Certificates, to be delivered to the Depositary
by, or on behalf of, the Company. Such Global Certificate shall initially be
registered on the books and records of the Company in the name of Cede & Co.,
the nominee of the Depositary, and no Beneficial Owner will receive a definitive
Certificate representing such Beneficial Owner's interest in such Global
Certificate, except as provided in Section 3.9. The Purchase Contract Agent
shall enter into an agreement with the Depositary if so requested by the
Company. Unless and until definitive, fully registered Certificates have been
issued to Beneficial Owners pursuant to Section 3.9:
(1) the provisions of this Section 3.6 shall be in full force and
effect;
(2) the Company shall be entitled to deal with the Clearing Agency for
all purposes of this Agreement (including making Purchase Contract Payments
and receiving approvals, votes or consents hereunder) as the Holder of the
Securities and the sole holder of the Global Certificates and shall have no
obligation to the Beneficial Owners;
(3) to the extent that the provisions of this Section 3.6 conflict
with any other provisions of this Agreement, the provisions of this Section
3.6 shall control; and
(4) the rights of the Beneficial Owners shall be exercised only
through the Clearing Agency and shall be limited to those established by
law and agreements between such Beneficial Owners and the Clearing Agency
or the Clearing Agency Participants.
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Section III.7. Notices to Holders.
Whenever a notice or other communication to the Holders is required to be
given under this Agreement, the Company or the Company's agent shall give such
notices and communications to the Holders and, with respect to any Securities
registered in the name of a Clearing Agency or the nominee of a Clearing Agency,
the Company or the Company's agent shall, except as set forth herein, have no
obligations to the Beneficial Owners.
Section III.8. Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as securities
depositary with respect to the Securities, the Company may, in its sole
discretion, appoint a successor Clearing Agency with respect to the Securities.
Section III.9. Definitive Certificates.
If:
(1) a Clearing Agency elects to discontinue its services as securities
depositary with respect to the Securities and a successor Clearing Agency
is not appointed within 90 days after such discontinuance pursuant to
Section 3.8; or
(2) there shall have occurred and be continuing a default by the
Company in respect of its obligations under one or more Purchase Contracts,
then upon surrender of the Global Certificates representing the Securities by
the Clearing Agency, accompanied by registration instructions, the Company shall
cause definitive Certificates to be delivered to Beneficial Owners in accordance
with the instructions of the Clearing Agency. The Company shall not be liable
for any delay in delivery of such instructions and may conclusively rely on and
shall be protected in relying on, such instructions.
Section III.10. Mutilated, Destroyed, Lost and Stolen Certificates.
If any mutilated Certificate is surrendered to the Purchase Contract Agent,
the Company shall execute and deliver to the Purchase Contract Agent, and the
Purchase Contract Agent shall authenticate, execute on behalf of the Holder, and
deliver in exchange therefor, a new Certificate, evidencing the same number of
PEPS Units or Treasury PEPS Units, as the case may be, and bearing a Certificate
number not contemporaneously outstanding.
If there shall be delivered to the Company and the Purchase Contract Agent
(i) evidence to their satisfaction of the destruction, loss or theft of any
Certificate, and (ii) such security or indemnity as may be required by them to
hold each of them and any agent of any of them harmless, then, in the absence of
notice to the Company or the Purchase Contract Agent that such Certificate has
been acquired by a bona fide purchaser, the Company shall execute and deliver to
the Purchase Contract Agent, and the Purchase Contract Agent shall authenticate,
execute on behalf of the Holder, and deliver to the Holder, in lieu of any such
destroyed, lost or stolen Certificate, a new Certificate, evidencing the same
number of PEPS Units or Treasury PEPS Units, as the case may be, and bearing a
Certificate number not contemporaneously outstanding.
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Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall not be obligated to authenticate, execute on behalf of the Holder,
and deliver to the Holder, a Certificate on or after the Business Day
immediately preceding the earlier of the Purchase Contract Settlement Date or
the Termination Date. In lieu of delivery of a new Certificate, upon
satisfaction of the applicable conditions specified above in this Section and
receipt of appropriate registration or transfer instructions from such Holder,
the Purchase Contract Agent shall:
(1) if the Purchase Contract Settlement Date has occurred, deliver the
shares of Georgia-Pacific Group Stock issuable in respect of the Purchase
Contracts forming a part of the Securities evidenced by such Certificate;
or
(2) if a Termination Event shall have occurred prior to the Purchase
Contract Settlement Date, transfer the Senior Deferrable Notes or the
Treasury Securities, as the case may be, evidenced thereby, in each case
subject to the applicable conditions and in accordance with the applicable
provisions of Article Five hereof.
Upon the issuance of any new Certificate under this Section, the Company
and the Purchase Contract Agent may require the payment by the Holder of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Purchase Contract Agent) connected therewith.
Every new Certificate issued pursuant to this Section in lieu of any
destroyed, lost or stolen Certificate shall constitute an original additional
contractual obligation of the Company and of the Holder in respect of the
Security evidenced thereby, whether or not the destroyed, lost or stolen
Certificate (and the Securities evidenced thereby) shall be at any time
enforceable by anyone, and shall be entitled to all the benefits and be subject
to all the obligations of this Agreement equally and proportionately with any
and all other Certificates delivered hereunder.
The provisions of this Section are exclusive and shall preclude, to the
extent lawful, all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Certificates.
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Section III.11. Persons Deemed Owners.
Prior to due presentment of a Certificate for registration of transfer, the
Company and the Purchase Contract Agent, and any agent of the Company or the
Purchase Contract Agent, may treat the Person in whose name such Certificate is
registered as the owner of the PEPS Units or Treasury PEPS Units evidenced
thereby, for the purpose of receiving interest payments on the Senior Deferrable
Notes, receiving Purchase Contract Payments, performance of the Purchase
Contracts and for all other purposes whatsoever, whether or not any interest
payments on the Senior Deferrable Notes or Purchase Contract Payments payable in
respect of the Purchase Contracts constituting a part of the PEPS Units or
Treasury PEPS Units evidenced thereby shall be overdue and notwithstanding any
notice to the contrary, and neither the Company nor the Purchase Contract Agent,
nor any agent of the Company or the Purchase Contract Agent, shall be affected
by notice to the contrary.
Notwithstanding the foregoing, with respect to any Global Certificate,
nothing contained herein shall prevent the Company, the Purchase Contract Agent
or any agent of the Company or the Purchase Contract Agent, from giving effect
to any written certification, proxy or other authorization furnished by any
Clearing Agency (or its nominee), as a Holder, with respect to such Global
Certificate or impair, as between such Clearing Agency and owners of beneficial
interests in such Global Certificate, the operation of customary practices
governing the exercise of rights of such Clearing Agency (or its nominee) as
Holder of such Global Certificate.
Section III.12. Cancellation.
All Certificates surrendered for delivery of shares of Georgia-Pacific
Group Stock on or after the Purchase Contract Settlement Date, upon the transfer
of Senior Deferrable Notes or Treasury Securities, as the case may be, after the
occurrence of a Termination Event or pursuant to an Early Settlement, or upon
the registration of transfer or exchange of a Security, or a Collateral
Substitution or the reestablishment of PEPS Units shall, if surrendered to any
Person other than the Purchase Contract Agent, be delivered to the Purchase
Contract Agent and, if not already cancelled, shall be promptly cancelled by it.
The Company may at any time deliver to the Purchase Contract Agent for
cancellation any Certificates previously authenticated, executed and delivered
hereunder which the Company may have acquired in any manner whatsoever, and all
Certificates so delivered shall, upon Issuer Order, be promptly cancelled by the
Purchase Contract Agent. No Certificates shall be authenticated, executed on
behalf of the Holder and delivered in lieu of or in exchange for any
Certificates cancelled as provided in this Section, except as expressly
permitted by this Agreement. All cancelled Certificates held by the Purchase
Contract Agent shall be destroyed by the Purchase Contract Agent unless
otherwise directed by Issuer Order.
If the Company or any Affiliate of the Company shall acquire any
Certificate, such acquisition shall not operate as a cancellation of such
Certificate unless and until such Certificate is delivered to the Purchase
Contract Agent cancelled or for cancellation.
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Section III.13. Creation of Treasury PEPS Units by Substitution of Treasury
Securities.
A Holder may separate the Senior Deferrable Notes from the related Purchase
Contracts in respect of such Holder's PEPS Units by substituting for such Senior
Deferrable Notes, Treasury Securities in an aggregate principal amount equal to
the aggregate principal amount of such Senior Deferrable Notes (a "Collateral
Substitution"), at any time from and after the date of this Agreement and prior
to or on the seventh Business Day immediately preceding the Purchase Contract
Settlement Date by:
(1) depositing with the Securities Intermediary Treasury Securities
having an aggregate principal amount equal to the aggregate principal
amount of the Senior Deferrable Notes comprising part of such PEPS Units;
and
(2) transferring the related PEPS Units to the Purchase Contract Agent
accompanied by a notice to the Purchase Contract Agent, substantially in
the form of Exhibit C hereto, (i) stating that the Holder has transferred
the relevant amount of Treasury Securities to the Securities Intermediary
and (ii) requesting that the Purchase Contract Agent instruct the
Collateral Agent to release the Senior Deferrable Notes underlying such
PEPS Units, whereupon the Purchase Contract Agent shall promptly give such
instruction to the Collateral Agent, substantially in the form of Exhibit A
to the Pledge Agreement.
Upon receipt of the Treasury Securities described in clause (1) above and the
instruction described in clause (2) above, in accordance with the terms of the
Pledge Agreement, the Collateral Agent will cause the Securities Intermediary to
effect the release of such Senior Deferrable Notes from the Pledge, free and
clear of the Company's security interest therein, and the transfer of such
Senior Deferrable Notes to the Purchase Contract Agent on behalf of the Holder.
Upon receipt thereof, the Purchase Contract Agent shall promptly:
(i) cancel the related PEPS Units;
(ii) transfer the Senior Deferrable Notes to the Holder; and
(iii) authenticate, execute on behalf of such Holder and deliver a
Treasury PEPS Units Certificate executed by the Company in accordance with
Section 3.3 evidencing the same number of Purchase Contracts as were
evidenced by the cancelled PEPS Units.
Holders who elect to separate the Senior Deferrable Notes from the related
Purchase Contracts and to substitute Treasury Securities for such Senior
Deferrable Notes shall be responsible for any fees or expenses payable to the
Collateral Agent for its services as Collateral Agent in respect of the
substitution, and the Company shall not be responsible for any such fees or
expenses.
Holders may make Collateral Substitutions only in integral multiples of 20
PEPS Units.
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In the event a Holder making a Collateral Substitution pursuant to this
Section 3.13 fails to effect a book-entry transfer of the PEPS Units or fails to
deliver PEPS Units Certificates to the Purchase Contract Agent after depositing
Treasury Securities with the Collateral Agent, the Senior Deferrable Notes,
constituting a part of such PEPS Units, and any interest payments on such Senior
Deferrable Notes, shall be held in the name of the Purchase Contract Agent or
its nominee in trust for the benefit of such Holder, until such PEPS Units are
so transferred or the PEPS Units Certificate is so delivered, as the case may
be, or, with respect to a PEPS Units Certificate, such Holder provides evidence
satisfactory to the Company and the Purchase Contract Agent that such PEPS Units
Certificate has been destroyed, lost or stolen, together with any indemnity that
may be required by the Purchase Contract Agent and the Company.
Except as described in this Section 3.13, for so long as the Purchase
Contract underlying a PEPS Unit remains in effect, such PEPS Unit shall not be
separable into its constituent parts, and the rights and obligations of the
Holder in respect of the Senior Deferrable Note and the Purchase Contract
comprising such PEPS Unit may be acquired, and may be transferred and exchanged,
only as a PEPS Unit.
Section III.14. Reestablishment of PEPS Units.
A Holder of Treasury PEPS Units may recreate PEPS Units at any time prior
to or on the seventh Business Day immediately preceding the Purchase Contract
Settlement Date by:
(1) depositing with the Securities Intermediary Senior Deferrable
Notes, having an aggregate principal amount equal to the aggregate
principal amount at maturity of the Treasury Securities comprising part of
the Treasury PEPS Units; and
(2) transferring the related Treasury PEPS Units to the Purchase
Contract Agent accompanied by a notice to the Purchase Contract Agent,
substantially in the form of Exhibit C hereto, (i) stating that the Holder
has transferred the relevant amount of Senior Deferrable Notes to the
Securities Intermediary and (ii) requesting that the Purchase Contract
Agent instruct the Collateral Agent to release the Treasury Securities
underlying such Treasury PEPS Units, whereupon the Purchase Contract Agent
shall promptly give such instruction to the Collateral Agent, substantially
in the form of Exhibit C to the Pledge Agreement.
Upon receipt of the Senior Deferrable Notes described in clause (1) above and
the instruction described in clause (2) above, in accordance with the terms of
the Pledge Agreement, the Collateral Agent will cause the Securities
Intermediary to effect the release of the Treasury Securities having a
corresponding aggregate principal amount at maturity from the Pledge, free and
clear of the Company's security interest therein, and the transfer to the
Purchase Contract Agent on behalf of the Holder. Upon receipt thereof, the
Purchase Contract Agent shall promptly:
(i) cancel the related Treasury PEPS Units;
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(ii) transfer the Treasury Securities to the Holder; and
(iii) authenticate, execute on behalf of such Holder and deliver a
PEPS Units Certificate executed by the Company in accordance with Section
3.3 evidencing the same number of Purchase Contracts as were evidenced by
the cancelled Treasury PEPS Units.
Holders who elect to recreate PEPS Units shall be responsible for any fees
or expenses payable to the Collateral Agent for its services as Collateral Agent
in respect of the substitution, and the Company shall not be responsible for any
such fees or expenses.
Holders of Treasury PEPS Units may reestablish PEPS Units in integral
multiples of 20 Treasury PEPS Units for 20 PEPS Units.
Except as provided in this Section 3.14, for so long as the Purchase
Contract underlying a Treasury PEPS Unit remains in effect, such Treasury PEPS
Unit shall not be separable into its constituent parts and the rights and
obligations of the Holder of such Treasury PEPS Unit in respect of the 1/20 of a
Treasury Security and the Purchase Contract comprising such Treasury PEPS Unit
may be acquired, and may be transferred and exchanged, only as a Treasury PEPS
Unit.
Section III.15. Transfer of Collateral upon Occurrence of Termination Event.
Upon the occurrence of a Termination Event and the transfer to the Purchase
Contract Agent of the Senior Deferrable Notes or the Treasury Securities, as the
case may be, underlying the PEPS Units and the Treasury PEPS Units, as the case
may be, pursuant to the terms of the Pledge Agreement, the Purchase Contract
Agent shall request transfer instructions with respect to such Senior Deferrable
Notes or Treasury Securities, as the case may be, from each Holder by written
request, substantially in the form of Exhibit D hereto, mailed to such Holder at
its address as it appears in the PEPS Units Register or the Treasury PEPS Units
Register, as the case may be.
Upon book-entry transfer of the PEPS Units or the Treasury PEPS Units or
delivery of a PEPS Units Certificate or Treasury PEPS Units Certificate to the
Purchase Contract Agent with such transfer instructions, the Purchase Contract
Agent shall transfer the Senior Deferrable Notes or Treasury Securities, as the
case may be, underlying such PEPS Units or Treasury PEPS Units, as the case may
be, to such Holder by book-entry transfer, or other appropriate procedures, in
accordance with such instructions. In the event a Holder of PEPS Units or
Treasury PEPS Units fails to effect such transfer or delivery, the Senior
Deferrable Notes or Treasury Securities, as the case may be, underlying such
PEPS Units or Treasury PEPS Units, as the case may be, and any distributions
thereon, shall be held in the name of the Purchase Contract Agent or its nominee
in trust for the benefit of such Holder, until the earlier of:
(1) such PEPS Units or Treasury PEPS Units are transferred or the PEPS
Units Certificate or Treasury PEPS Units Certificate is surrendered or such
Holder
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provides satisfactory evidence that such PEPS Units Certificate or Treasury
PEPS Units Certificate has been destroyed, lost or stolen, together with
any indemnity that may be required by the Purchase Contract Agent and the
Company; and
(2) the expiration of the time period specified in the abandoned
property laws of the relevant State.
Section III.16. No Consent to Assumption.
Each Holder of a Security, by acceptance thereof, shall be deemed expressly
to have withheld any consent to the assumption under Section 365 of the
Bankruptcy Code or otherwise, of the Purchase Contract by the Company or its
trustee, receiver, liquidator or a person or entity performing similar functions
in the event that the Company becomes the debtor under the Bankruptcy Code or
subject to other similar state or Federal law providing for reorganization or
liquidation.
ARTICLE IV
The Senior Deferrable Notes
Section IV.1. Interest Payments; Rights to Interest Payments Preserved.
An interest payment on any Senior Deferrable Note which is paid on any
Payment Date shall, subject to receipt thereof by the Purchase Contract Agent
from the Collateral Agent as provided by the terms of the Pledge Agreement, be
paid to the Person in whose name the PEPS Units Certificate (or one or more
Predecessor PEPS Units Certificates) of which such Senior Deferrable Note is a
part is registered at the close of business on the Record Date for such Payment
Date.
Each PEPS Units Certificate evidencing the Senior Deferrable Note delivered
under this Agreement upon registration of transfer of or in exchange for or in
lieu of any other PEPS Units Certificate shall carry the right to accrued and
unpaid and deferred interest and the right to accrue interest, which rights were
carried by the Senior Deferrable Note underlying such other PEPS Units
Certificate.
In the case of any PEPS Units with respect to which Cash Settlement of the
underlying Purchase Contract is effected prior to or on the fifth Business Day
immediately preceding the Purchase Contract Settlement Date pursuant to prior
notice, or with respect to which Early Settlement of the underlying Purchase
Contract is effected on an Early Settlement Date, or with respect to which a
Collateral Substitution is effected, in each case on a date that is after any
Record Date and prior to or on the next succeeding Payment Date, the interest
payment on the Senior Deferrable Note underlying such PEPS Unit otherwise
payable on such Payment Date shall be payable on such Payment Date
notwithstanding such Cash Settlement or Early Settlement or Collateral
Substitution, and such interest payment shall, subject to receipt thereof by the
Purchase Contract Agent, be payable to the Person in whose name the PEPS Units
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Certificate (or one or more Predecessor PEPS Units Certificates) was registered
at the close of business on the Record Date. Except as otherwise expressly
provided in the immediately preceding sentence, in the case of any PEPS Unit
with respect to which Cash Settlement or Early Settlement of the underlying
Purchase Contract is effected prior to or on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date or an Early Settlement Date, as
the case may be, or with respect to which a Collateral Substitution has been
effected, interest payments on the related Senior Deferrable Notes that would
otherwise be payable after the Purchase Contract Settlement Date or Early
Settlement Date shall not be payable hereunder to the Holder of such PEPS Units;
provided, however, that to the extent that such Holder continues to hold the
separated Senior Deferrable Note that formerly comprised a part of such Holder's
PEPS Unit, such Holder shall be entitled to receive the interest payments on
such separated Senior Deferrable Note, as provided in the Senior Deferrable
Notes Board Resolutions.
Section IV.2. Deferral of Interest Payments.
So long as no event of default has occurred and is occurring under the
Indenture, the Company shall have the right at any time until the Stated
Maturity of the Senior Deferrable Notes to defer the payment of interest on the
Senior Deferrable Notes for a period of time not extending beyond the Stated
Maturity (each such period of deferral, an "Extension Period"). If the Company
so elects to defer interest payments on the Senior Deferrable Notes, the Company
shall pay at the end of the Extension Period all interest then accrued and
unpaid, together with accrued interest at the Coupon Rate or the Reset Rate, as
applicable, compounded on each succeeding Payment Date.
Section IV.3. Interest Rate Reset; Notice Relating to Cash Settlement.
The Coupon Rate on the Senior Deferrable Notes on and after the Purchase
Contract Settlement Date shall be reset on the third Business Day immediately
preceding the Purchase Contract Settlement Date equal to the Reset Rate (such
Reset Rate to be in effect on and after the Purchase Contract Settlement Date).
The Reset Rate shall be equal to or greater than the Coupon Rate.
Not later than 15 calendar days nor more than 30 calendar days prior to the
third Business Day immediately preceding the Purchase Contract Settlement Date,
the Company shall request DTC (or any successor Clearing Agency), to notify the
Beneficial Owners or Clearing Agency Participants holding PEPS Units of the
procedures to be followed by Holders of PEPS Units who intend to effect a Cash
Settlement prior to or on the fifth Business Day immediately preceding the
Purchase Contract Settlement Date.
Section IV.4. Notice and Voting.
Under the terms of the Pledge Agreement, the Purchase Contract Agent will
be entitled to exercise the voting and any other consensual rights pertaining to
the Pledged Senior Deferrable Notes, but only to the extent instructed in
writing by the Holders as described below. Upon receipt of notice of any
meeting at which holders of Senior Deferrable Notes are entitled to vote
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or upon any solicitation of consents, waivers or proxies of holders of Senior
Deferrable Notes, the Purchase Contract Agent shall, as soon as practicable
thereafter, mail to the Holders of PEPS Units a notice:
(1) containing such information as is contained in the notice or
solicitation;
(2) stating that each Holder on the record date set by the Purchase
Contract Agent therefor (which, to the extent possible, shall be the same
date as the record date for determining the holders of Senior Deferrable
Notes, as the case may be, entitled to vote) shall be entitled to instruct
the Purchase Contract Agent as to the exercise of the voting rights
pertaining to such Senior Deferrable Notes underlying their PEPS Units; and
(3) stating the manner in which such instructions may be given.
Upon the written request of the Holders of PEPS Units on such record date
received by the Purchase Contract Agent at least six days prior to such meeting,
the Purchase Contract Agent shall endeavor insofar as practicable to vote or
cause to be voted, in accordance with the instructions set forth in such
requests, the maximum number of Senior Deferrable Notes, as to which any
particular voting instructions are received. In the absence of specific
instructions from the Holder of a PEPS Unit, the Purchase Contract Agent shall
abstain from voting the Senior Deferrable Notes underlying such PEPS Unit. The
Company hereby agrees, if applicable, to solicit Holders of PEPS Units to timely
instruct the Purchase Contract Agent in order to enable the Purchase Contract
Agent to vote such Senior Deferrable Notes.
ARTICLE V
The Purchase Contracts
Section V.1. Purchase of Shares of Georgia-Pacific Group Stock.
Each Purchase Contract shall, unless an Early Settlement has occurred in
accordance with Section 5.9 hereof, obligate the Holder of the related Security
to purchase, and the Company to sell, on the Purchase Contract Settlement Date
at a price equal to the Stated Amount (the "Purchase Price"), a number of shares
of Georgia-Pacific Group Stock equal to the Settlement Rate unless, prior to or
on the Purchase Contract Settlement Date, there shall have occurred a
Termination Event with respect to the Security of which such Purchase Contract
is a part. The "Settlement Rate" is equal to:
(1) if the Applicable Market Value (as defined below) equals or
exceeds $. (the "Threshold Appreciation Price"), . shares of Georgia-
Pacific Group Stock per Purchase Contract;
(2) if the Applicable Market Value is less than the Threshold
Appreciation Price but greater than $. (the "Reference Price"), the number
of shares of Georgia-Pacific Group Stock having a value, based on the
Applicable Market Value, equal to the Stated Amount; and
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(3) if the Applicable Market Value is less than or equal to the
Reference Price, . shares of Georgia-Pacific Group Stock per Purchase
Contract,
in each case subject to adjustment as provided in Section 5.6 (and in each case
rounded upward or downward to the nearest 1/10,000th of a share).
As provided in Section 5.11, no fractional shares of Georgia-Pacific Group
Stock will be issued upon settlement of Purchase Contracts.
The "Applicable Market Value" means the average of the Closing Price per
share of Georgia-Pacific Group Stock on each of the 20 consecutive Trading Days
ending on the third Trading Day immediately preceding the Purchase Contract
Settlement Date.
The "Closing Price" per share of Georgia-Pacific Group Stock on any date of
determination means:
(1) the closing sale price (or, if no closing price is reported, the
last reported sale price) per share on the New York Stock Exchange, Inc.
(the "NYSE") on such date;
(2) if Georgia-Pacific Group Stock is not listed for trading on the
NYSE on any such date, the closing sale price per share as reported in the
composite transactions for the principal United States securities exchange
on which Georgia-Pacific Group Stock is so listed;
(3) if Georgia-Pacific Group Stock is not so listed on a United States
national or regional securities exchange, the closing sale price per share
as reported by The Nasdaq Stock Market, Inc.;
(4) if Georgia-Pacific Group Stock is not so reported, the last quoted
bid price for Georgia-Pacific Group Stock in the over-the-counter market as
reported by the National Quotation Bureau or similar organization; or
(5) if such bid price is not available, the average of the mid-point
of the last bid and ask prices of Georgia-Pacific Group Stock on such date
from at least three nationally recognized independent investment banking
firms retained for this purpose by the Company.
A "Trading Day" means a day on which Georgia-Pacific Group Stock (1) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (2) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of Georgia-Pacific Group Stock.
Each Holder of a PEPS Unit or a Treasury PEPS Unit, by its acceptance
thereof:
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(1) irrevocably authorizes the Purchase Contract Agent to enter into
and perform the related Purchase Contract on its behalf as its attorney-in-
fact (including the execution of Certificates on behalf of such Holder);
(2) agrees to be bound by the terms and provisions thereof;
(3) covenants and agrees to perform its obligations under such
Purchase Contracts;
(4) consents to the provisions hereof;
(5) irrevocably authorizes the Purchase Contract Agent to enter into
and perform this Agreement and the Pledge Agreement on its behalf as its
attorney-in-fact; and
(6) consents to, and agrees to be bound by, the Pledge of the Senior
Deferrable Notes or the Treasury Securities pursuant to the Pledge
Agreement,
provided that upon a Termination Event, the rights of the Holder of such
Security under the Purchase Contract may be enforced without regard to any other
rights or obligations. Each Holder of a PEPS Unit or a Treasury PEPS Unit, by
its acceptance thereof, further covenants and agrees, that to the extent and in
the manner provided in Section 5.4 and the Pledge Agreement, but subject to the
terms thereof, payments in respect of the Senior Deferrable Notes or the
proceeds from the Treasury Securities at maturity on the Purchase Contract
Settlement Date, as the case may be, shall be paid by the Collateral Agent to
the Company in satisfaction of such Holder's obligations under such Purchase
Contract and such Holder shall acquire no right, title or interest in such
payments.
Upon registration of transfer of a Certificate, the transferee shall be
bound (without the necessity of any other action on the part of such transferee)
by the terms of this Agreement, the Purchase Contracts underlying such
Certificate and the Pledge Agreement and the transferor shall be released from
the obligations under this Agreement, the Purchase Contracts underlying the
Certificate so transferred and the Pledge Agreement. The Company covenants and
agrees, and each Holder of a Certificate, by its acceptance thereof, likewise
covenants and agrees, to be bound by the provisions of this paragraph.
Section V.2. Purchase Contract Payments.
The Company shall pay, on each Payment Date, the Purchase Contract Payments
payable in respect of each Purchase Contract to the Person in whose name a
Certificate (or one or more Predecessor Certificates) is registered at the close
of business on the Record Date next preceding such Payment Date. The Purchase
Contract Payments will be payable at the office of the Purchase Contract Agent
in New York City maintained for that purpose or, at the option of the Company,
by check mailed to the address of the Person entitled thereto at such Person's
address
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as it appears on the PEPS Units Register or Treasury PEPS Units
Register. If any date on which Purchase Contract Payments are to be made is not
a Business Day, then payment of the Purchase Contract Payments payable on such
date will be made on the next day that is a Business Day (and without any
interest in respect of any such delay), except that, if such Business Day is in
the next calendar year, such payment will be made on the preceding Business Day.
Upon the occurrence of a Termination Event, the Company's obligation to pay
Purchase Contract Payments (including any accrued or deferred Purchase Contract
Payments) shall cease.
Each Certificate delivered under this Agreement upon registration of
transfer of or in exchange for or in lieu of (including as a result of a
Collateral Substitution or the reestablishment of PEPS Units) any other
Certificate shall carry the right to accrued and unpaid or deferred Purchase
Contract Payments and the right to accrue Purchase Contract Payments, which
rights were carried by the Purchase Contracts underlying such other
Certificates.
Subject to Section 5.9, in the case of any Security with respect to which
Early Settlement of the underlying Purchase Contract is effected on an Early
Settlement Date that is after any Record Date and prior to or on the next
succeeding Payment Date, Purchase Contract Payments otherwise payable on such
Payment Date shall be payable on such Payment Date notwithstanding such Early
Settlement, and such Purchase Contract Payments shall be paid to the Person in
whose name the Certificate evidencing such Security (or one or more Predecessor
Certificates) is registered at the close of business on such Record Date.
Except as otherwise expressly provided in the immediately preceding sentence, in
the case of any Security with respect to which Early Settlement of the
underlying Purchase Contract is effected on an Early Settlement Date, Purchase
Contract Payments that would otherwise be payable after the Early Settlement
Date with respect to such Purchase Contract shall not be payable.
Section V.3. Deferral of Purchase Contract Payments.
The Company has the right to defer payment of all or part of the Purchase
Contract Payments in respect of each Purchase Contract until no later than the
Purchase Contract Settlement Date. If the Company so elects to defer Purchase
Contract Payments, the Company shall pay additional Purchase Contract Payments
on such deferred installments of Purchase Contract Payments at a rate equal to
.% per annum, compounding quarterly, until such deferred installments are paid.
If a Holder effects an Early Settlement or if a Termination Event shall occur,
such Holder will have no right to receive any accrued deferred Purchase Contract
Payments.
Section V.4. Payment of Purchase Price.
(a) (i) Unless a Holder of a PEPS Unit effects an Early Settlement of the
underlying Purchase Contract in the manner described in Section 5.9, each such
Holder who intends to pay in cash to satisfy such Holder's obligations under the
Purchase Contract shall notify the Purchase Contract Agent by use of a notice in
substantially the form of Exhibit E hereto of his intention to pay in cash
("Cash Settlement") the Purchase Price for the shares of
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Georgia-Pacific Group Stock to be purchased pursuant to the related Purchase
Contract. Such notice shall be given prior to 5:00 p.m. (New York City time) on
the seventh Business Day immediately preceding the Purchase Contract Settlement
Date. Prior to 11:00 a.m. (New York City time) on the next succeeding Business
Day, the Purchase Contract Agent shall notify the Collateral Agent and the
Senior Trustee of the receipt of such notices from Holders intending to make a
Cash Settlement.
(ii) A Holder of a PEPS Unit who has so notified the Purchase Contract
Agent of his intention to effect a Cash Settlement in accordance with paragraph
(a)(i) above shall pay the Purchase Price to the Securities Intermediary for
deposit in the Collateral Account prior to 11:00 a.m. (New York City time) on
the fifth Business Day immediately preceding the Purchase Contract Settlement
Date in lawful money of the United States by certified or cashiers' check or
wire transfer, in each case in immediately available funds payable to or upon
the order of the Securities Intermediary. Any cash received by the Collateral
Agent shall be invested promptly by the Securities Intermediary in Permitted
Investments and paid to the Company on the Purchase Contract Settlement Date in
settlement of the Purchase Contract in accordance with the terms of this
Agreement and the Pledge Agreement. Any funds received by the Securities
Intermediary in respect of the investment earnings from the investment in such
Permitted Investments, shall be distributed to the Purchase Contract Agent when
received for payment to the Holder of the related PEPS Unit.
(iii) If a Holder of a PEPS Unit fails to notify the Purchase
Contract Agent of his intention to make a Cash Settlement in accordance with
paragraph (a)(i) above, or does notify the Purchase Contract Agent as provided
in paragraph (a)(i) above of his intention to pay the Purchase Price in cash,
but fails to make such payment as required by paragraph (a)(ii) above, such
Holder shall be deemed to have consented to the disposition of the Pledged
Senior Deferrable Notes pursuant to the Remarketing as described in paragraph
(b) below.
(iv) Promptly after 11:00 a.m. (New York City time) on the fifth
Business Day preceding the Purchase Contract Settlement Date, the Purchase
Contract Agent, based on notices received by the Purchase Contract Agent
pursuant to Section 5.4(a) hereof and notice from the Securities Intermediary
regarding cash received by it prior to such time, shall notify the Collateral
Agent and the Senior Trustee of the aggregate number of Senior Deferrable Notes
to be tendered for purchase in the Remarketing in a notice substantially in the
form of Exhibit F hereto.
(b) In order to dispose of the Senior Deferrable Notes, PEPS Units Holders
who have not notified the Purchase Contract Agent of their intention to effect a
Cash Settlement as provided in paragraph (a)(i) above, or who have so notified
the Purchase Contract Agent but failed to make such payment as required by
paragraph (a)(ii) above, the Company shall engage Morgan Stanley & Co.
Incorporated (the "Remarketing Agent") pursuant to the Remarketing Agreement to
sell such Senior Deferrable Notes. In order to facilitate the Remarketing, the
Purchase Contract Agent, based on the notices specified in Section 5.4(a)(iv),
shall notify the Remarketing Agent, promptly after 11:00 a.m. (New York City
time) on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date, of the aggregate number of
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Senior Deferrable Notes that are part of PEPS Units to be remarketed.
Concurrently, the Collateral Agent, pursuant to the terms of the Pledge
Agreement, shall cause such Senior Deferrable Notes to be presented to the
Remarketing Agent for Remarketing.
Upon receipt of such notice from the Purchase Contract Agent and such
Senior Deferrable Notes, the Remarketing Agent shall, on the third Business Day
immediately preceding the Purchase Contract Settlement Date, use reasonable
efforts to remarket such Senior Deferrable Notes on such date at a price equal
to at least 100.25% of the Stated Amount ($50.1250), as provided in the
Remarketing Agreement. The proceeds from the Remarketing shall automatically be
applied by the Collateral Agent, in accordance with the Pledge Agreement, to
satisfy in full such PEPS Units Holders' obligations to pay the Purchase Price
for the shares of Georgia-Pacific Group Stock under the related Purchase
Contracts on the Purchase Contract Settlement Date. In addition, $.1250 per
Senior Deferrable Note of the proceeds shall automatically be remitted to the
Remarketing Agent for services rendered in connection with the Remarketing (the
"Remarketing Fee"). Any proceeds remaining after satisfaction of the Purchase
Contract and payment of the Remarketing Fee shall be payable to the Holder of
such PEPS Unit.
If, in spite of using their reasonable efforts, the Remarketing Agent
cannot remarket the related Senior Deferrable Notes of such Holders of PEPS
Units at a price equal to at least 100.25% of the Stated Amount ($50.1250), the
Remarketing shall be deemed to have failed (a "Failed Remarketing") and in
accordance with the terms of the Pledge Agreement, the Collateral Agent, for the
benefit of the Company, shall exercise its rights as a secured party with
respect to such Senior Deferrable Notes, including those actions specified in
paragraph (c) below; provided, that if upon a Failed Remarketing the Collateral
Agent exercises such rights for the benefit of the Company with respect to such
Senior Deferrable Notes, any accrued and unpaid and deferred interest on such
Senior Deferrable Notes shall become payable by the Company to the Purchase
Contract Agent for payment to the Beneficial Owner of the PEPS Units to which
such Senior Deferrable Notes relate. The Company shall cause a notice of such
Failed Remarketing to be published on the second Business Day immediately
preceding the Purchase Contract Settlement Date in a daily newspaper in the
English language of general circulation in New York City, which is expected to
be The Wall Street Journal, and on Bloomberg News.
(c) With respect to any Senior Deferrable Notes which are subject to a
Failed Remarketing, the Collateral Agent for the benefit of the Company reserves
all of its rights as a secured party with respect thereto and, subject to
applicable law and paragraph (g) below, may, among other things, (i) retain the
Senior Deferrable Notes in full satisfaction of the Holders' obligations under
the Purchase Contracts or (ii) sell the Senior Deferrable Notes in one or more
public or private sales.
(d) (i) Unless a Holder of a Treasury PEPS Units effects an Early
Settlement of the underlying Purchase Contract through the early delivery of
cash to the Purchase Contract Agent in the manner described in Section 5.9, each
such Holder who intends to pay in cash shall notify the Purchase Contract Agent
by use of a notice in substantially the form of Exhibit E hereto of his
intention to pay in cash the Purchase Price for the shares of Georgia-Pacific
Group
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Stock to be purchased pursuant to the related Purchase Contract. Such
notice shall be given prior to 5:00 p.m. (New York City time) on the seventh
Business Day immediately preceding the Purchase Contract Settlement Date. Prior
to 11:00 a.m. (New York City time) on the next succeeding Business Day, the
Purchase Contract Agent shall notify the Collateral Agent of the receipt of such
notices from such Holders intending to make a Cash Settlement.
(ii) A Holder of a Treasury PEPS Unit who has so notified the Purchase
Contract Agent of his intention to make a Cash Settlement in accordance with
paragraph (d)(i) above shall pay the Purchase Price to the Securities
Intermediary for deposit in the Collateral Account prior to 11:00 a.m. (New York
City time) on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date in lawful money of the United States by certified or cashiers'
check or wire transfer, in each case in immediately available funds payable to
or upon the order of the Securities Intermediary. Any cash received by the
Collateral Agent shall be invested promptly by the Securities Intermediary in
Permitted Investments and paid to the Company on the Purchase Contract
Settlement Date in settlement of the Purchase Contract in accordance with the
terms of this Agreement and the Pledge Agreement. Any funds received by the
Securities Intermediary in respect of the investment earnings from the
investment in such Permitted Investments shall be distributed to the Purchase
Contract Agent when received for payment to the Holder of the related Treasury
PEPS Unit.
(iii) If a Holder of a Treasury PEPS Unit fails to notify the
Purchase Contract Agent of his intention to make a Cash Settlement in accordance
with paragraph (d)(i) above, or does notify the Purchase Contract Agent as
provided in paragraph (d)(i) above of his intention to pay the Purchase Price in
cash, but fails to make such payment as required by paragraph (d)(ii) above,
then upon the maturity of the Pledged Treasury Securities held by the Securities
Intermediary on the Business Day immediately preceding the Purchase Contract
Settlement Date, the principal amount of the Treasury Securities received by the
Securities Intermediary shall be invested promptly in Permitted Investments.
On the Purchase Contract Settlement Date, an amount equal to the
Purchase Price shall be remitted to the Company as payment thereof without
receiving any instructions from the Holder of the related Treasury PEPS Unit.
In the event the sum of the proceeds from the related Pledged Treasury
Securities and the investment earnings earned from such investments is in excess
of the aggregate Purchase Price of the Purchase Contracts being settled thereby,
the Collateral Agent shall cause the Securities Intermediary to distribute such
excess to the Purchase Contract Agent for the benefit of the Holder of the
related Treasury PEPS Unit when received.
(iv) A Holder of a Treasury PEPS Unit may elect to have the Senior
Deferrable Note, no longer a part of a PEPS Unit, remarketed. A Holder making
such an election must notify the Senior Trustee prior to 11:00 a.m. (New York
City time) on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date, of the aggregate number of Senior Deferrable Notes that are not
part of PEPS Units to be remarketed. Any such notice will be irrevocable and
may not be conditioned upon the level at which the Reset Rate is established in
the Remarketing. Concurrently, the Senior Trustee shall cause such Senior
Deferrable Notes to be presented to the Remarketing Agent for Remarketing.
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(e) Any distribution to Holders of excess funds and interest described
above shall be payable at the office of the Purchase Contract Agent in New York
City maintained for that purpose or, at the option of the Holder, by check
mailed to the address of the Person entitled thereto at such address as it
appears on the Register.
(f) Upon Cash Settlement of any Purchase Contract:
(1) the Collateral Agent will in accordance with the terms of the
Pledge Agreement cause the Pledged Senior Deferrable Note or the Pledged
Treasury Securities, as the case may be, underlying the relevant Security
to be released from the Pledge, free and clear of any security interest of
the Company, and transferred to the Purchase Contract Agent for delivery to
the Holder thereof or its designee as soon as practicable; and
(2) subject to the receipt thereof, the Purchase Contract Agent shall,
by book-entry transfer or other appropriate procedures, in accordance with
written instructions provided by the Holder thereof, transfer such Senior
Deferrable Note or such Treasury Securities, as the case may be (or, if no
such instructions are given to the Purchase Contract Agent by the Holder,
the Purchase Contract Agent shall hold such Senior Deferrable Note or such
Treasury Securities, as the case may be, and any interest payment thereon,
in the name of the Purchase Contract Agent or its nominee in trust for the
benefit of such Holder until the expiration of the time period specified in
the abandoned property laws of the relevant State).
(g) The obligations of the Holders to pay the Purchase Price are non-
recourse obligations and, except to the extent satisfied by Early Settlement or
Cash Settlement, are payable solely out of the proceeds of any Collateral
pledged to secure the obligations of the Holders and in no event will Holders be
liable for any deficiency between the proceeds of the disposition of Collateral
and the Purchase Price.
(h) The Company shall not be obligated to issue any shares of Georgia-
Pacific Group Stock in respect of a Purchase Contract or deliver any
certificates thereof to the Holder of the related PEPS Unit or Treasury PEPS
Unit unless the Company shall have received payment in full for the aggregate
purchase price for the Georgia-Pacific Group Stock to be purchased thereunder in
the manner herein set forth.
Section V.5. Issuance of Shares of Georgia-Pacific Group Stock.
Unless a Termination Event or an Early Settlement shall have occurred,
subject to Section 5.6(b), the Company shall issue and deposit with the Purchase
Contract Agent, for the benefit of the Holders of the Outstanding Securities,
one or more certificates representing the shares of Georgia-Pacific Group Stock
registered in the name of the Purchase Contract Agent (or its nominee) as
custodian for the Holders (such certificates for shares of Georgia-Pacific Group
Stock, together with any dividends or distributions for which a record date and
payment date for
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such dividend or distribution has occurred after the Purchase
Contract Settlement Date, being hereinafter referred to as the "Purchase
Contract Settlement Fund") to which the Holders are entitled hereunder.
Subject to the foregoing, upon surrender of a Certificate to the Purchase
Contract Agent on or after the Purchase Contract Settlement Date, together with
settlement instructions thereon duly completed and executed, the Holder of such
Certificate shall be entitled to receive forthwith in exchange therefor a
certificate representing that number of whole shares of Georgia-Pacific Group
Stock which such Holder is entitled to receive pursuant to the provisions of
this Article Five (after taking into account all Securities then held by such
Holder), together with cash in lieu of fractional shares as provided in Section
5.11 and any dividends or distributions with respect to such shares constituting
part of the Purchase Contract Settlement Fund, but without any interest thereon,
and the Certificate so surrendered shall forthwith be cancelled. Such shares
shall be registered in the name of the Holder or the Holder's designee as
specified in the settlement instructions provided by the Holder to the Purchase
Contract Agent. If any shares of Georgia-Pacific Group Stock issued in respect
of a Purchase Contract are to be registered to a Person other than the Person in
whose name the Certificate evidencing such Purchase Contract is registered, no
such registration shall be made unless the Person requesting such registration
has paid any transfer and other taxes required by reason of such registration in
a name other than that of the registered Holder of the Certificate evidencing
such Purchase Contract or has established to the satisfaction of the Company
that such tax either has been paid or is not payable.
Section V.6. Adjustment of Settlement Rate.
(a Adjustments for Dividends, Distributions, Stock Splits, Etc.
(1 In case the Company shall pay or make a dividend or other
distribution on Georgia-Pacific Group Stock in Georgia-Pacific Group Stock,
the Settlement Rate in effect at the opening of business on the day
following the date fixed for the determination of shareholders entitled to
receive such dividend or other distribution shall be increased by dividing
such Settlement Rate by a fraction of which:
(i) the numerator shall be the number of shares of Georgia-
Pacific Group Stock outstanding at the close of business on the date
fixed for such determination; and
(ii) the denominator shall be the sum of such number of shares
and the total number of shares constituting such dividend or other
distribution,
such increase to become effective immediately after the opening of business
on the day following the date fixed for such determination. For the
purposes of this paragraph (1), the number of shares of Georgia-Pacific
Group Stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include any shares issuable in respect of
any scrip certificates issued in lieu of fractions of shares of Georgia-
Pacific
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Group Stock. The Company will not pay any dividend or make any distribution
on shares of Georgia-Pacific Group Stock held in the treasury of the
Company.
(2 In case the Company shall issue rights, warrants or options to all
holders of its Georgia-Pacific Group Stock (not being available on an
equivalent basis to Holders of the Securities upon settlement of the
Purchase Contracts underlying such Securities) entitling them, for a period
expiring within 45 days after the record date for the determination of
shareholders entitled to receive such rights, warrants or options, to
subscribe for or purchase shares of Georgia-Pacific Group Stock at a price
per share less than the Current Market Price per share of Georgia-Pacific
Group Stock on the date fixed for the determination of shareholders
entitled to receive such rights, warrants or options (other than pursuant
to a dividend reinvestment plan), the Settlement Rate in effect at the
opening of business on the day following the date fixed for such
determination shall be increased by dividing such Settlement Rate by a
fraction of which:
(i) the numerator shall be the number of shares of Georgia-
Pacific Group Stock outstanding at the close of business on the date
fixed for such determination plus the number of shares of Georgia-
Pacific Group Stock which the aggregate of the offering price of the
total number of shares of Georgia-Pacific Group Stock so offered for
subscription or purchase would purchase at such Current Market Price;
and
(ii) the denominator shall be the number of shares of Georgia-
Pacific Group Stock outstanding at the close of business on the date
fixed for such determination plus the number of shares of Georgia-
Pacific Group Stock so offered for subscription or purchase,
such increase to become effective immediately after the opening of business
on the day following the date fixed for such determination. For the
purposes of this paragraph (2), the number of shares of Georgia-Pacific
Group Stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include any shares issuable in respect of
any scrip certificates issued in lieu of fractions of shares of Georgia-
Pacific Group Stock. The Company shall not issue any such rights, warrants
or options in respect of shares of Georgia-Pacific Group Stock held in the
treasury of the Company.
(3 In case outstanding shares of Georgia-Pacific Group Stock shall be
subdivided or split into a greater number of shares of Georgia-Pacific
Group Stock, the Settlement Rate in effect at the opening of business on
the day following the day upon which such subdivision or split becomes
effective shall be proportionately increased, and, conversely, in case
outstanding shares of Georgia-Pacific Group Stock shall each be combined
into a smaller number of shares of Georgia-Pacific Group Stock, the
Settlement Rate in effect at the opening of business on the day following
the day upon which such combination becomes effective shall be
proportionately reduced, such increase or reduction, as the case may be, to
become effective immediately after the opening of
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business on the day following the day upon which such subdivision, split or
combination becomes effective.
(4 In case the Company shall, by dividend or otherwise, distribute to
all holders of its Georgia-Pacific Group Stock evidences of its
indebtedness or assets (including securities, but excluding any rights,
warrants or options referred to in paragraph (2) of this Section 5.6(a),
any dividend or distribution paid exclusively in cash and any dividend or
distribution referred to in paragraph (1) of this Section 5.6(a)), the
Settlement Rate shall be adjusted so that the same shall equal the rate
determined by dividing the Settlement Rate in effect immediately prior to
the close of business on the date fixed for the determination of
shareholders entitled to receive such distribution by a fraction of which:
(i) the numerator shall be the Current Market Price per share of
Georgia-Pacific Group Stock on the date fixed for such determination
less the then fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a
Board Resolution) of the portion of the assets or evidences of
indebtedness so distributed applicable to one share of Georgia-Pacific
Group Stock; and
(ii) the denominator shall be such Current Market Price per share
of Georgia-Pacific Group Stock,
such adjustment to become effective immediately prior to the opening of
business on the day following the date fixed for the determination of
shareholders entitled to receive such distribution. In any case in which
this paragraph (4) is applicable, paragraph (2) of this Section 5.6(a)
shall not be applicable.
(5 In case the Company shall, by dividend or otherwise, distribute to
all holders of its Georgia-Pacific Group Stock cash (excluding:
(x) any quarterly cash dividend on Georgia-Pacific Group Stock to the
extent that the aggregate cash dividend per share of Georgia-Pacific Group
Stock in any fiscal quarter does not exceed the greater of (A) the amount
per share of Georgia-Pacific Group Stock of the next preceding quarterly
cash dividend on Georgia-Pacific Group Stock to the extent that such
preceding quarterly dividend did not require an adjustment of the
Settlement Rate pursuant to this Section 5.6(a)(5) (as adjusted to reflect
subdivisions or combinations of Georgia-Pacific Group Stock), and (B) 3.75%
of the arithmetic average of the Closing Prices of Georgia-Pacific Group
Stock during the ten consecutive Trading Days immediately prior to the date
of declaration of such dividend, and
(y) any dividend or distribution in connection with the liquidation,
dissolution or termination of the Company, whether voluntary or
involuntary),
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then, in such case, the Settlement Rate shall be increased so that the same
shall equal the rate determined by multiplying the Settlement Rate in
effect immediately prior to the close of business on such record date by a
fraction of which:
(i) the numerator shall be the Current Market Price of Georgia-
Pacific Group Stock; and
(ii) the denominator shall be the Current Market Price of
Georgia-Pacific Group Stock on the record date less the amount of cash
so distributed (and not excluded as provided above) applicable to one
share of Georgia-Pacific Group Stock,
such increase to be effective immediately prior to the opening of business
on the day following the record date; provided, however, that in the event
the portion of cash so distributed applicable to one share of Georgia-
Pacific Group Stock is equal to or greater than the Current Market Price
per share of Georgia-Pacific Group Stock on the record date, in lieu of the
foregoing adjustment, adequate provision shall be made so that each holder
of a Security shall have the right to receive upon settlement of the
Securities the amount of cash such Holder would have received had such
Holder settled each Security on the record date. In the event that such
dividend or distribution is not so paid or made, the Settlement Rate shall
again be adjusted to be the Settlement Rate which would then be in effect
if such dividend or distribution had not been declared. If any adjustment
is required to be made as set forth in this Section 5.6(a)(5) as a result
of a distribution that is a quarterly dividend, such adjustment shall be
based upon the amount by which such distribution exceeds the amount of the
quarterly cash dividend permitted to be excluded pursuant to this Section
5.6(a)(5), notwithstanding the provisions of Section 5.6(a)(10). If an
adjustment is required to be made as set forth in this Section 5.6(a)(5)
above as a result of a distribution that is not a quarterly dividend, such
adjustment shall be based upon the full amount of the distribution.
(6 In case a tender or exchange offer made by the Company or any
subsidiary of the Company for all or any portion of Georgia-Pacific Group
Stock shall expire and such tender or exchange offer (as amended upon the
expiration thereof) shall require the payment to shareholders (based on the
acceptance (up to any maximum specified in the terms of the tender or
exchange offer) of Purchased Shares) of (I) an aggregate consideration
having a fair market value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a Board Resolution) that
combined together with the aggregate of the cash plus the fair market value
(as determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution), as of the expiration of
such tender or exchange offer, of consideration payable in respect of any
other tender or exchange offer, by the Company or any subsidiary of the
Company for all or any portion of Georgia-Pacific Group Stock expiring
within the 12 months preceding the expiration of such tender or exchange
offer and in respect of which no adjustment pursuant to this paragraph (6)
has been made, and (II) the aggregate amount of any distributions to all
holders of Georgia-Pacific Group Stock made
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exclusively in cash within the 12 months preceding the expiration of such
tender or exchange offer and in respect of which no adjustment pursuant to
paragraph (6) has been made, exceeds 15% of the product of the Current
Market Price per share of Georgia-Pacific Group Stock as of the last time
(the "Expiration Time") tenders could have been made pursuant to such
tender or exchange offer (as it may be amended) times the number of shares
of Georgia-Pacific Group Stock outstanding (including any tendered shares)
on the Expiration Time, then, and in each such case, immediately prior to
the opening of business on the day after the date of the Expiration Time,
the Settlement Rate shall be adjusted so that the same shall equal the rate
determined by dividing the Settlement Rate immediately prior to the close
of business on the date of the Expiration Time by a fraction:
(i) the numerator of which shall be equal to (A) the product of
(I) the Current Market Price per share of Georgia-Pacific Group Stock
on the date of the Expiration Time and (II) the number of shares of
Georgia-Pacific Group Stock outstanding (including any tendered
shares) on the Expiration Time less (B) the amount of cash plus the
fair market value (determined as aforesaid) of the aggregate
consideration payable to shareholders based on the transactions
described in clauses (I) and (II) above (assuming in the case of
clause (I) the acceptance, up to any maximum specified in the terms of
the tender or exchange offer, of Purchased Shares); and
(ii) the denominator of which shall be equal to the product of
(A) the Current Market Price per share of Georgia-Pacific Group Stock
as of the Expiration Time and (B) the number of shares of Georgia-
Pacific Group Stock outstanding (including any tendered shares) as of
the Expiration Time less the number of all shares validly tendered and
not withdrawn as of the Expiration Time (the shares deemed so
accepted, up to any such maximum, being referred to as the "Purchased
Shares").
(7 The reclassification of Georgia-Pacific Group Stock into securities
including securities other than Georgia-Pacific Group Stock (other than any
reclassification upon a Reorganization Event to which Section 5.6(b)
applies) shall be deemed to involve:
(i) a distribution of such securities other than Georgia-Pacific
Group Stock to all holders of Georgia-Pacific Group Stock (and the
effective date of such reclassification shall be deemed to be "the
date fixed for the determination of shareholders entitled to receive
such distribution" and the "date fixed for such determination" within
the meaning of paragraph (4) of this Section); and
(ii) a subdivision, split or combination, as the case may be, of
the number of shares of Georgia-Pacific Group Stock outstanding
immediately prior to such reclassification into the number of shares
of Georgia-Pacific Group Stock outstanding immediately thereafter (and
the effective date of such reclassification
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shall be deemed to be "the day upon which such subdivision or split
becomes effective" or "the day upon which such combination becomes
effective", as the case may be, and "the day upon which such
subdivision, split or combination becomes effective" within the
meaning of paragraph (3) of this Section).
(8 The "Current Market Price" per share of Georgia-Pacific Group Stock
on any day means the average of the daily Closing Prices for the five
consecutive Trading Days selected by the Company commencing not more than
30 Trading Days before, and ending not later than, the earlier of the day
in question and the day before the "ex date" with respect to the issuance
or distribution requiring such computation. For purposes of this
paragraph, the term "ex date", when used with respect to any issuance or
distribution, shall mean the first date on which Georgia-Pacific Group
Stock trades regular way on such exchange or in such market without the
right to receive such issuance or distribution.
(9 All adjustments to the Settlement Rate shall be calculated to the
nearest 1/10,000th of a share of Georgia-Pacific Group Stock (or if there
is not a nearest 1/10,000th of a share, to the next lower 1/10,000th of a
share). No adjustment in the Settlement Rate shall be required unless such
adjustment would require an increase or decrease of at least one percent
thereof; provided, however, that any adjustments which by reason of this
subparagraph are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. If an adjustment is made to the
Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or
(10) of this Section 5.6(a), an adjustment shall also be made to the
Applicable Market Value solely to determine which of clauses (a), (b) or
(c) of the definition of Settlement Rate in Section 5.1 will apply on the
Purchase Contract Settlement Date. Such adjustment shall be made by
multiplying the Applicable Market Value by a fraction of which the
numerator shall be the Settlement Rate immediately after such adjustment
pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of this
Section 5.6(a) and the denominator shall be the Settlement Rate immediately
prior to such adjustment; provided, however, that if such adjustment to the
Settlement Rate is required to be made pursuant to the occurrence of any of
the events contemplated by paragraph (1), (2), (3), (4), (5), (7) or (10)
of this Section 5.6(a) during the period taken into consideration for
determining the Applicable Market Value, appropriate and customary
adjustments shall be made to the Settlement Rate.
(10 The Company may make such increases in the Settlement Rate, in
addition to those required by this Section, as it considers to be advisable
in order to avoid or diminish any income tax to any holders of shares of
Georgia-Pacific Group Stock resulting from any dividend or distribution of
stock or issuance of rights or warrants to purchase or subscribe for stock
or from any event treated as such for income tax purposes or for any other
reason.
(b Adjustment for Consolidation, Merger or Other Reorganization Event.
In the event of:
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(i) any consolidation or merger of the Company with or into another
Person (other than a merger or consolidation in which the Company is the
continuing corporation and in which the shares of Georgia-Pacific Group
Stock outstanding immediately prior to the merger or consolidation are not
exchanged for cash, securities or other property of the Company or another
corporation);
(ii) any sale, transfer, lease or conveyance to another Person of the
property of the Company as an entirety or substantially as an entirety;
(iii) any statutory share exchange of the Company with another Person
(other than in connection with a merger or acquisition);
(iv) any liquidation, dissolution or termination of the Company other
than as a result of or after the occurrence of a Termination Event;
(v) any conversion of all of the shares of Georgia-Pacific Group Stock
into shares of Timber Stock pursuant to the Company's Restated Articles of
Incorporation (any such event, a "Reorganization Event"),
the Settlement Rate will be adjusted to provide that each Holder of Securities
will receive on the Purchase Contract Settlement Date with respect to each
Purchase Contract forming a part thereof, the kind and amount of securities,
cash and other property receivable upon such Reorganization Event (without any
interest thereon, and without any right to dividends or distribution thereon
which have a record date that is prior to the Purchase Contract Settlement Date)
by a Holder of the number of shares of Georgia-Pacific Group Stock issuable on
account of each Purchase Contract if the Purchase Contract Settlement Date had
occurred immediately prior to such Reorganization Event, assuming such Holder of
Georgia-Pacific Group Stock is not a Person with which the Company consolidated
or into which the Company merged or which merged into the Company or to which
such sale or transfer was made, as the case may be (any such Person, a
"Constituent Person"), or an Affiliate of a Constituent Person to the extent
such Reorganization Event provides for different treatment of Georgia-Pacific
Group Stock held by Affiliates of the Company and non-affiliates and such Holder
failed to exercise his rights of election, if any, as to the kind or amount of
securities, cash and other property receivable upon such Reorganization Event
(provided that if the kind or amount of securities, cash and other property
receivable upon such Reorganization Event is not the same for each share of
Georgia-Pacific Group Stock held immediately prior to such Reorganization Event
by other than a Constituent Person or an Affiliate thereof and in respect of
which such rights of election shall not have been exercised ("non-electing
share"), then for the purpose of this Section the kind and amount of securities,
cash and other property receivable upon such Reorganization Event by each non-
electing share shall be deemed to be the kind and amount so receivable per share
by a plurality of the non-electing shares).
In the event of such a Reorganization Event, the Person formed by such
consolidation, merger or exchange or the Person which acquires the assets of the
Company or, in the event of a
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liquidation, dissolution or termination of the Company, the Company or a
liquidating trust created in connection therewith, shall execute and deliver to
the Purchase Contract Agent an agreement supplemental hereto providing that the
Holders of each Outstanding Security shall have the rights provided by this
Section 5.6(b). Such supplemental agreement shall provide for adjustments which,
for events subsequent to the effective date of such supplemental agreement,
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Section. The above provisions of this Section shall similarly apply
to successive Reorganization Events.
(c All calculations and determinations pursuant to this Section 5.6 shall
be made by the Company or its agent and the Purchase Contract Agent shall have
no responsibility with respect thereto.
Section V.7. Notice of Adjustments and Certain Other Events.
(a Whenever the Settlement Rate is adjusted as herein provided, the
Company shall:
(1) forthwith compute the adjusted Settlement Rate in accordance with
Section 5.6 and prepare and transmit to the Purchase Contract Agent an
Officers' Certificate setting forth the Settlement Rate, the method of
calculation thereof in reasonable detail, and the facts requiring such
adjustment and upon which such adjustment is based; and
(2) within 10 Business Days following the occurrence of an event that
requires an adjustment to the Settlement Rate pursuant to Section 5.6 (or
if the Company is not aware of such occurrence, as soon as practicable
after becoming so aware), provide a written notice to the Holders of the
Securities of the occurrence of such event and a statement in reasonable
detail setting forth the method by which the adjustment to the Settlement
Rate was determined and setting forth the adjusted Settlement Rate.
(b The Purchase Contract Agent shall not at any time be under any duty or
responsibility to any Holder of Securities to determine whether any facts exist
which may require any adjustment of the Settlement Rate, or with respect to the
nature or extent or calculation of any such adjustment when made, or with
respect to the method employed in making the same. The Purchase Contract Agent
shall not be accountable with respect to the validity or value (or the kind or
amount) of any shares of Georgia-Pacific Group Stock, or of any securities or
property, which may at the time be issued or delivered with respect to any
Purchase Contract; and the Purchase Contract Agent makes no representation with
respect thereto. The Purchase Contract Agent shall not be responsible for any
failure of the Company to issue, transfer or deliver any shares of Georgia-
Pacific Group Stock pursuant to a Purchase Contract or to comply with any of the
duties, responsibilities or covenants of the Company contained in this Article.
Section V.8. Termination Event; Notice.
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The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Purchase Contract
Payments (including any deferred or accrued and unpaid Purchase Contract
Payments), if the Company shall have such obligation, and the rights and
obligations of Holders to purchase Georgia-Pacific Group Stock, shall
immediately and automatically terminate, without the necessity of any notice or
action by any Holder, the Purchase Contract Agent or the Company, if, prior to
or on the Purchase Contract Settlement Date, a Termination Event shall have
occurred.
Upon and after the occurrence of a Termination Event, the Securities shall
thereafter represent the right to receive the Senior Deferrable Notes forming
part of such Securities in the case of PEPS Units, or Treasury Securities in the
case of Treasury PEPS Units, in accordance with the provisions of Section 5.4 of
the Pledge Agreement. Upon the occurrence of a Termination Event, the Company
shall promptly but in no event later than two Business Days thereafter give
written notice to the Purchase Contract Agent, the Collateral Agent and the
Holders, at their addresses as they appear in the Register.
Section V.9. Early Settlement.
(a Subject to and upon compliance with the provisions of this Section
5.9, at the option of the Holder thereof, Purchase Contracts underlying
Securities may be settled early ("Early Settlement") prior to or on the seventh
Business Day immediately preceding the Purchase Contract Settlement Date, as
provided herein. In order to exercise the right to effect Early Settlement with
respect to any Purchase Contracts, the Holder of the Certificate evidencing
Securities shall deliver such Certificates to the Purchase Contract Agent at the
Corporate Trust Office duly endorsed for transfer to the Company or in blank
with the form of Election to Settle Early on the reverse thereof duly completed
and accompanied by payment (payable to the Company in immediately available
funds) in an amount (the "Early Settlement Amount") equal to:
(1) the product of (A) the Stated Amount times (B) the number of
Purchase Contracts with respect to which the Holder has elected to effect
Early Settlement, plus
(2) if such delivery is made with respect to any Purchase Contracts
during the period from the close of business on any Record Date next
preceding any Payment Date to the opening of business on such Payment Date,
an amount equal to the sum of (x) the Purchase Contract Payments payable on
such Payment Date with respect to such Purchase Contracts plus (y) in the
case of a PEPS Units Certificate, the interest on the related Senior
Deferrable Notes payable on such Payment Date.
Except as provided in the immediately preceding sentence and subject to the
second to last paragraph of Section 5.2, no payment shall be made upon Early
Settlement of any Purchase Contract on account of any Purchase Contract Payments
accrued on such Purchase Contract or on account of any dividends on the Georgia-
Pacific Group Stock issued upon such Early Settlement. If the foregoing
requirements are first satisfied with respect to Purchase Contracts
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underlying any Securities prior to or at 5:00 p.m. (New York City time) on a
Business Day, such day shall be the "Early Settlement Date" with respect to such
Securities and if such requirements are first satisfied after 5:00 p.m. (New
York City time) on a Business Day or on a day that is not a Business Day, the
"Early Settlement Date" with respect to such Securities shall be the next
succeeding Business Day.
(b Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the Company shall issue, and the Holder shall be entitled to
receive, . shares of Georgia-Pacific Group Stock on account of each Purchase
Contract as to which Early Settlement is effected (the "Early Settlement Rate").
The Early Settlement Rate shall be adjusted in the same manner and at the same
time as the Settlement Rate is adjusted.
(c No later than the third Business Day after the applicable Early
Settlement Date, the Company shall cause:
(1) the shares of Georgia-Pacific Group Stock issuable upon Early
Settlement of Purchase Contracts to be issued and delivered, together with
payment in lieu of any fraction of a share, as provided in Section 5.11;
and
(2) the related Senior Deferrable Notes, in the case of PEPS Units, or
the related Treasury Securities, in the case of Treasury PEPS Units, to be
released from the Pledge by the Collateral Agent and transferred, in each
case, to the Purchase Contract Agent for delivery to the Holder thereof or
its designee.
(d Upon Early Settlement of any Purchase Contracts, and subject to
receipt of shares of Georgia-Pacific Group Stock from the Company and the Senior
Deferrable Notes or Treasury Securities, as the case may be, from the Securities
Intermediary, as applicable, the Purchase Contract Agent shall, in accordance
with the instructions provided by the Holder thereof on the applicable form of
Election to Settle Early on the reverse of the Certificate evidencing the
related Securities:
(1) transfer to the Holder the Senior Deferrable Notes or Treasury
Securities, as the case may be, forming a part of such Securities; and
(2) deliver to the Holder a certificate or certificates for the full
number of shares of Georgia-Pacific Group Stock issuable upon such Early
Settlement, together with payment in lieu of any fraction of a share, as
provided in Section 5.11.
(e In the event that Early Settlement is effected with respect to
Purchase Contracts underlying less than all the Securities evidenced by a
Certificate, upon such Early Settlement the Company shall execute and the
Purchase Contract Agent shall authenticate, countersign and deliver to the
Holder thereof, at the expense of the Company, a Certificate evidencing the
Securities as to which Early Settlement was not effected.
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(f) A Holder of a Security who effects Early Settlement may elect to have
the Senior Deferrable Note, no longer a part of a PEPS Unit or Treasury PEPS
Unit. as the case my be, remarketed. A Holder making such an election must
notify the Senior Trustee prior to 11:00 a.m. (New York City time) on the fifth
Business Day immediately preceding the Purchase Contract Settlement Date, of the
aggregate number of Senior Deferrable Notes that are not part of PEPS Units or
Treasury PEPS Units, as the case may be, to be remarketed. Any such notice will
be irrevocable and may not be conditioned upon the level at which the Reset Rate
is established in the Remarketing. Concurrently, the Senior Trustee shall cause
such Senior Deferrable Notes to be presented to the Remarketing Agent for
Remarketing.
Section V.10. Acceleration of Purchase Contract Settlement Date.
(a) (i) In the event the Company sells, transfers, assigns or otherwise
disposes of (whether by merger, consolidation, sale or contribution of assets or
stock or otherwise), in one transaction or a series of related transactions, all
of the properties and assets of the Georgia-Pacific Group, (a "Disposition"), to
one or more Persons (other than:
(1) the Disposition by the Company of all of the Company's properties
and assets in one transaction or a series of related transactions in
connection with the liquidation, dissolution or termination of the Company
and the distribution of assets to shareholders;
(2) on a pro rata basis to the holders of all outstanding shares of
Georgia-Pacific Group Stock;
(3) to any Person controlled by the Company (as determined by the
Board); or
(4) in connection with a Related Business Transaction),
and the Company determines to redeem all of the outstanding shares of Georgia-
Pacific Group Stock in exchange for cash and/or securities (other than Common
Stock) and other property having a Fair Value as of the date of such
consummation in the aggregate equal to the Fair Value of the Net Proceeds of
such Disposition as of the date of such consummation (a "Redemption"), then the
Purchase Contract Settlement Date shall be accelerated to the fifth Business Day
immediately preceding the 85th Trading Day following the consummation of such
Disposition (the "Redemption Date").
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(ii) Not later than the 10th Trading Day following the consummation of
such a Disposition, the Company shall announce publicly by press release:
(1) the estimated Net Proceeds of such Disposition;
(2) the number of shares of Georgia-Pacific Group Stock outstanding;
and
(3) the number of shares of Georgia-Pacific Group Stock into which or
for which outstanding Convertible Securities (including the Purchase
Contracts) are then convertible, exchangeable or exercisable and the
conversion, exchange or exercise price thereof.
(iii) Not earlier than the 26th Trading Day and not later than the
30th Trading Day following the consummation of such a Disposition, the Company
shall announce publicly by press release that it has irrevocably determined to
effect the Redemption.
(iv) Not earlier than the 35th Trading Day and not later than the 45th
Trading Day following the consummation of such a Disposition, the Company shall
cause to be given to the Purchase Contract Agent, the Collateral Agent, the
Securities Intermediary, the Remarketing Agent, DTC (or any successor Clearing
Agency) and each Holder of a Purchase Contract a notice setting forth, among
other things required by the Company's Restated Articles of Incorporation:
(1) a statement that the Purchase Contract Settlement Date is being
accelerated to the fifth Business Day prior to the Redemption Date because
all shares of Georgia-Pacific Group Stock outstanding on the Redemption
Date are being redeemed on the Redemption Date;
(2) the time and date by which a Holder must give notice to the
Purchase Contract Agent of his intention to effect a Cash Settlement
pursuant to Section 5.4 of the Purchase Contract Agreement, which shall be
prior to 5:00 p.m. (New York City time) on the seventh Business Day
preceding the accelerated Purchase Contract Settlement Date;
(3) the time and date by which a Holder who has so notified the
Purchase Contract Agent of his intention to effect a Cash Settlement must
pay the Purchase Price to the Securities Intermediary for deposit in the
Collateral Account, which shall be prior to 11:00 a.m. (New York City time)
on the fifth Business Day preceding the accelerated Purchase Contract
Settlement Date;
(4) the time and date by which the Purchase Contract Agent shall
notify the Collateral Agent and the Senior Trustee of the aggregate number
of Senior Deferrable Notes to be tendered for purchase in the Remarketing,
which shall be after 11:00 a.m. (New York City time) on the fifth Business
Day preceding the accelerated Purchase Contract Settlement Date;
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(5) the time and date by which the Purchase Contract Agent shall
notify the Remarketing Agent of the aggregate number of Senior Deferrable
Notes to be remarketed, which shall be after 11:00 a.m. (New York City
time) on the fifth Business Day preceding the accelerated Purchase Contract
Settlement Date;
(6) the date on which the Remarketing Agent shall use reasonable
efforts to remarket such Senior Deferrable Notes, which shall be the third
Business Day preceding the accelerated Purchase Contract Settlement Date;
(7) the date by which a Holder electing to effect an Early Settlement
must effect such Early Settlement, which shall be the seventh Business Day
preceding the accelerated Purchase Contract Settlement Date; and
(8) the Redemption Date.
(b) (i) In the event that all of the assets and liabilities of the
Georgia-Pacific Group (and no other assets or liabilities of the Company or any
subsidiary thereof) are held directly or indirectly by one or more wholly owned
subsidiaries of the Company (the "Georgia-Pacific Group Subsidiaries"), and the
Company determines to redeem all of the outstanding shares of Georgia-Pacific
Group Stock in exchange for all of the outstanding shares of the common stock
of the Georgia-Pacific Group Subsidiaries equal to the number of shares of the
Georgia-Pacific Group Subsidiaries to be outstanding immediately following such
redemption, then the Purchase Contract Settlement Date shall be accelerated to
the fifth Business Day immediately preceding such redemption date (the "Spin-Off
Date").
(ii) Not earlier than the 30th Trading Day and not later than the 45th
Trading Day prior to the Spin-Off Date, the Company shall cause to be given to
the Purchase Contract Agent, the Collateral Agent, the Securities Intermediary,
the Remarketing Agent, DTC (or any successor Clearing Agency) and each Holder
of a Purchase Contract a notice setting forth, among other things required by
the Company's Restated Articles of Incorporation:
(1) a statement that the Purchase Contract Settlement Date is being
accelerated to the fifth Business Day prior to the Spin-Off Date because
all shares of Georgia-Pacific Group Stock outstanding on the Spin-Off Date
are being redeemed on the Spin-Off Date in exchange for shares of common
stock of the Georgia-Pacific Group Subsidiaries;
(2) the time and date by which a Holder must give notice to the
Purchase Contract Agent of his intention to effect a Cash Settlement
pursuant to Section 5.4 of the Purchase Contract Agreement, which shall be
prior to 5:00 p.m. (New York City time) on the seventh Business Day
preceding the accelerated Purchase Contract Settlement Date;
(3) the time and date by which a Holder who has so notified the
Purchase Contract Agent of his intention to effect a Cash Settlement must
pay the Purchase Price to the Securities Intermediary for deposit in the
Collateral Account, which shall be prior to
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11:00 a.m. (New York City time) on the fifth Business Day preceding the
accelerated Purchase Contract Settlement Date;
(4) the time and date by which the Purchase Contract Agent shall
notify the Collateral Agent and the Senior Trustee of the aggregate number
of Senior Deferrable Notes to be tendered for purchase in the Remarketing,
which shall be after 11:00 a.m. (New York City time) on the fifth Business
Day preceding the accelerated Purchase Contract Settlement Date;
(5) the time and date by which the Purchase Contract Agent shall
notify the Remarketing Agent of the aggregate number of Senior Deferrable
Notes to be remarketed, which shall be after 11:00 a.m. (New York City
time) on the fifth Business Day preceding the accelerated Purchase Contract
Settlement Date;
(6) the date on which the Remarketing Agent shall use reasonable
efforts to remarket such Senior Deferrable Notes, which shall be the third
Business Day preceding the accelerated Purchase Contract Settlement Date;
(7) the date by which a Holder electing to effect an Early Settlement
must effect such Early Settlement, which shall be the seventh Business Day
preceding the accelerated Purchase Contract Settlement Date; and
(8) the Spin-Off Date.
Section V.11. No Fractional Shares.
No fractional shares or scrip representing fractional shares of Georgia-
Pacific Group Stock shall be issued or delivered upon settlement on the Purchase
Contract Settlement Date or upon Early Settlement of any Purchase Contracts. If
Certificates evidencing more than one Purchase Contract shall be surrendered for
settlement at one time by the same Holder, the number of full shares of Georgia-
Pacific Group Stock which shall be delivered upon settlement shall be computed
on the basis of the aggregate number of Purchase Contracts evidenced by the
Certificates so surrendered. Instead of any fractional share of Georgia-Pacific
Group Stock which would otherwise be deliverable upon settlement of any Purchase
Contracts on the Purchase Contract Settlement Date or upon Early Settlement, the
Company, through the Purchase Contract Agent, shall make a cash payment in
respect of such fractional interest in an amount equal to the value of such
fractional shares times the Applicable Market Value. The Company shall provide
the Purchase Contract Agent from time to time with sufficient funds to permit
the Purchase Contract Agent to make all cash payments required by this Section
5.11 in a timely manner.
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Section V.12. Charges and Taxes.
The Company will pay all stock transfer and similar taxes attributable to
the initial issuance and delivery of the shares of Georgia-Pacific Group Stock
pursuant to the Purchase Contracts; provided, however, that the Company shall
not be required to pay any such tax or taxes which may be payable in respect of
any exchange of or substitution for a Certificate evidencing a Security or any
issuance of a share of Georgia-Pacific Group Stock in a name other than that of
the registered Holder of a Certificate surrendered in respect of the Securities
evidenced thereby, other than in the name of the Purchase Contract Agent, as
custodian for such Holder, and the Company shall not be required to issue or
deliver such share certificates or Certificates unless or until the Person or
Persons requesting the transfer or issuance thereof shall have paid to the
Company the amount of such tax or shall have established to the satisfaction of
the Company that such tax has been paid.
ARTICLE VI
Remedies
Section VI.1. Unconditional Right of Holders to Receive Purchase Contract
Payments and to Purchase Shares of Georgia-Pacific Group Stock.
Each Holder of a PEPS Unit or Treasury PEPS Unit shall have the right,
which is absolute and unconditional, (1) subject to the payment by such Holder
of Purchase Contract Payments pursuant to Section 5.9(a), to receive each
Purchase Contract Payment with respect to the Purchase Contract constituting a
part of such Security on the respective Payment Date for such Security,
provided, however, that a Holder will have no right to receive any accrued
deferred Purchase Contract Payments if he effects an Early Settlement or if a
Termination Event shall occur and (2) to purchase shares of Georgia-Pacific
Group Stock pursuant to such Purchase Contract and, in each such case, to
institute suit for the enforcement of any such Purchase Contract Payment and
right to purchase shares of Georgia-Pacific Group Stock, and such rights shall
not be impaired without the consent of such Holder.
Section VI.2. Restoration of Rights and Remedies.
If any Holder has instituted any proceeding to enforce any right or remedy
under this Agreement and such proceeding has been discontinued or abandoned for
any reason, or has been determined adversely to such Holder, then and in every
such case, subject to any determination in such proceeding, the Company and such
Holder shall be restored severally and respectively to their former positions
hereunder and thereafter all rights and remedies of such Holder shall continue
as though no such proceeding had been instituted.
Section VI.3. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Certificates in the last paragraph of
Section 3.10, no right or remedy
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herein conferred upon or reserved to the Holders is intended to be exclusive of
any other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in equity or otherwise.
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
Section VI.4. Delay or Omission Not Waiver.
No delay or omission of any Holder to exercise any right or remedy upon a
default shall impair any such right or remedy or constitute a waiver of any such
right. Every right and remedy given by this Article or by law to the Holders
may be exercised from time to time, and as often as may be deemed expedient, by
such Holders.
Section VI.5. Undertaking for Costs.
All parties to this Agreement agree, and each Holder of a PEPS Unit or a
Treasury PEPS Unit, by its acceptance of such PEPS Unit or Treasury PEPS Unit
shall be deemed to have agreed, that any court may in its discretion require, in
any suit for the enforcement of any right or remedy under this Agreement, or in
any suit against the Purchase Contract Agent for any action taken, suffered or
omitted by it as Purchase Contract Agent, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that such court
may in its discretion assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such suit, having due regard to the merits
and good faith of the claims or defenses made by such party litigant; provided
that the provisions of this Section shall not apply to any suit instituted by
the Company, to any suit instituted by the Purchase Contract Agent, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than 10% of the Outstanding Securities, or to any suit instituted by any Holder
for the enforcement of distributions on any Senior Deferrable Notes or Purchase
Contract Payments on any Purchase Contract on or after the respective Payment
Date therefor in respect of any Security held by such Holder, or for enforcement
of the right to purchase shares of Georgia-Pacific Group Stock under the
Purchase Contracts constituting part of any Security held by such Holder.
Section VI.6. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Agreement; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Purchase Contract Agent or the Holders, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
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ARTICLE VII
The Purchase Contract Agent
Section VII.1. Certain Duties and Responsibilities.
(a) The Purchase Contract Agent:
(1) undertakes to perform, with respect to the Securities, such duties
and only such duties as are specifically set forth in this Agreement and
the Pledge Agreement, and no implied covenants or obligations shall be read
into this Agreement or the Pledge Agreement against the Purchase Contract
Agent; and
(2) in the absence of bad faith or negligence on its part, may, with
respect to the Securities, conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Purchase Contract Agent and
conforming to the requirements of this Agreement or the Pledge Agreement,
as applicable, but in the case of any certificates or opinions which by any
provision hereof are specifically required to be furnished to the Purchase
Contract Agent, the Purchase Contract Agent shall be under a duty to
examine the same to determine whether or not they conform to the
requirements of this Agreement or the Pledge Agreement, as applicable.
(b) No provision of this Agreement or the Pledge Agreement shall be
construed to relieve the Purchase Contract Agent from liability for its own
negligent action, its own negligent failure to act, or its own wilful
misconduct, except that:
(1) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;
(2) the Purchase Contract Agent shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it shall be
proved that the Purchase Contract Agent was negligent in ascertaining the
pertinent facts; and
(3) no provision of this Agreement or the Pledge Agreement shall
require the Purchase Contract Agent to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers, if
adequate indemnity is not provided to it.
(c) Whether or not therein expressly so provided, every provision of this
Agreement and the Pledge Agreement relating to the conduct or affecting the
liability of or affording protection to the Purchase Contract Agent shall be
subject to the provisions of this Section.
(d) The Purchase Contract Agent is authorized to execute and deliver the
Pledge Agreement in its capacity as Purchase Contract Agent.
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Section VII.2. Notice of Default.
Within 30 days after the occurrence of any default by the Company hereunder
of which a Responsible Officer of the Purchase Contract Agent has actual
knowledge, the Purchase Contract Agent shall transmit by mail to the Company and
the Holders of Securities, as their names and addresses appear in the Register,
notice of such default hereunder, unless such default shall have been cured or
waived.
Section VII.3. Certain Rights of Purchase Contract Agent.
Subject to the provisions of Section 7.1:
(1) the Purchase Contract Agent may rely and shall be protected in
acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness or
other paper or document believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Officers' Certificate, Issuer Order or Issuer
Request, and any resolution of the Board of Directors of the Company may be
sufficiently evidenced by a Board Resolution;
(3) whenever in the administration of this Agreement or the Pledge
Agreement the Purchase Contract Agent shall deem it desirable that a matter
be proved or established prior to taking, suffering or omitting any action
hereunder, the Purchase Contract Agent (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part, rely
upon an Officers' Certificate of the Company;
(4) the Purchase Contract Agent may consult with counsel and the
written advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance thereon;
(5) the Purchase Contract Agent shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Purchase Contract Agent,
in its discretion, may make reasonable further inquiry or investigation
into such facts or matters related to the execution, delivery and
performance of the Purchase Contracts as it may see fit, and, if the
Purchase Contract Agent shall determine to make such further inquiry or
investigation, it shall be given a reasonable opportunity to examine the
books, records and premises of the Company, personally or by agent or
attorney; and
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(6) the Purchase Contract Agent may execute any of the powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or an Affiliate and the Purchase Contract Agent shall
not be responsible for any misconduct or negligence on the part of any
agent or attorney or an Affiliate appointed with due care by it hereunder.
Section VII.4. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Certificates shall be taken as the
statements of the Company, and the Purchase Contract Agent assumes no
responsibility for their accuracy. The Purchase Contract Agent makes no
representations as to the validity or sufficiency of either this Agreement or of
the Securities, or of the Pledge Agreement or the Pledge. The Purchase Contract
Agent shall not be accountable for the use or application by the Company of the
proceeds in respect of the Purchase Contracts.
Section VII.5. May Hold Securities.
Any Registrar or any other agent of the Company, or the Purchase Contract
Agent and its Affiliates, in their individual or any other capacity, may become
the owner or pledgee of Securities and may otherwise deal with the Company, the
Collateral Agent or any other Person with the same rights it would have if it
were not Registrar or such other agent, or the Purchase Contract Agent.
Section VII.6. Money Held in Custody.
Money held by the Purchase Contract Agent in custody hereunder need not be
segregated from the other funds except to the extent required by law or provided
herein. The Purchase Contract Agent shall be under no obligation to invest or
pay interest on any money received by it hereunder except as otherwise agreed in
writing with the Company.
Section VII.7. Compensation and Reimbursement.
The Company agrees:
(1) to pay to the Purchase Contract Agent compensation for all
services rendered by it hereunder and under the Pledge Agreement as the
Company and the Purchase Contract Agent shall from time to time agree in
writing;
(2) except as otherwise expressly provided for herein, to reimburse
the Purchase Contract Agent upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Purchase Contract Agent
in accordance with any provision of this Agreement and the Pledge Agreement
(including the reasonable compensation and the expenses and disbursements
of its agents and counsel), except any such expense, disbursement or
advance as may be attributable to its negligence or bad faith; and
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(3) to indemnify the Purchase Contract Agent and any predecessor
Purchase Contract Agent for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of
its duties hereunder, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder.
Section VII.8. Corporate Purchase Contract Agent Required; Eligibility.
There shall at all times be an Purchase Contract Agent hereunder which
shall be a corporation organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia, authorized
under such laws to exercise corporate trust powers, having (or being a member of
a bank holding company having) a combined capital and surplus of at least
$50,000,000, subject to supervision or examination by Federal or State authority
and having a corporate trust office in the Borough of Manhattan, New York City,
if there be such a corporation in the Borough of Manhattan, New York City,
qualified and eligible under this Article and willing to act on reasonable
terms. If such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of said supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Purchase Contract Agent shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.
Section VII.9. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Purchase Contract Agent and no
appointment of a successor Purchase Contract Agent pursuant to this Article
shall become effective until the acceptance of appointment by the successor
Purchase Contract Agent in accordance with the applicable requirements of
Section 7.10.
(b) The Purchase Contract Agent may resign at any time by giving written
notice thereof to the Company 60 days prior to the effective date of such
resignation. If the instrument of acceptance by a successor Purchase Contract
Agent required by Section 7.10 shall not have been delivered to the Purchase
Contract Agent within 30 days after the giving of such notice of resignation,
the resigning Purchase Contract Agent may petition any court of competent
jurisdiction for the appointment of a successor Purchase Contract Agent.
(c) The Purchase Contract Agent may be removed at any time by Act of the
Holders of a majority in number of the Outstanding Securities delivered to the
Purchase Contract Agent and the Company.
(d) If at any time:
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(1) the Purchase Contract Agent fails to comply with Section 310(b) of
the TIA, as if the Purchase Contract Agent were an indenture trustee under
an indenture qualified under the TIA, after written request therefor by the
Company or by any Holder who has been a bona fide Holder of a Security for
at least six months;
(2) the Purchase Contract Agent shall cease to be eligible under
Section 7.8 and shall fail to resign after written request therefor by the
Company or by any such Holder; or
(3) the Purchase Contract Agent shall become incapable of acting or
shall be adjudged a bankrupt or insolvent or a receiver of the Purchase
Contract Agent or of its property shall be appointed or any public officer
shall take charge or control of the Purchase Contract Agent or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Purchase Contract Agent, or (ii) any Holder who has been a bona fide Holder of a
Security for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the removal
of the Purchase Contract Agent and the appointment of a successor Purchase
Contract Agent.
(e) If the Purchase Contract Agent shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Purchase
Contract Agent for any cause, the Company, by a Board Resolution, shall promptly
appoint a successor Purchase Contract Agent and shall comply with the applicable
requirements of Section 7.10. If no successor Purchase Contract Agent shall
have been so appointed by the Company and accepted appointment in the manner
required by Section 7.10, any Holder who has been a bona fide Holder of a
Security for at least six months may, on behalf of itself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Purchase Contract Agent.
(f) The Company shall give, or shall cause such successor Purchase Contract
Agent to give, notice of each resignation and each removal of the Purchase
Contract Agent and each appointment of a successor Purchase Contract Agent by
mailing written notice of such event by first-class mail, postage prepaid, to
all Holders as their names and addresses appear in the applicable Register.
Each notice shall include the name of the successor Purchase Contract Agent and
the address of its Corporate Trust Office.
Section VII.10. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Purchase Contract
Agent, every such successor Purchase Contract Agent so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Purchase Contract
Agent an instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Purchase Contract Agent shall become effective and such
successor Purchase Contract Agent, without any further act, deed or conveyance,
shall become vested with all the rights, powers, agencies and duties of the
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retiring Purchase Contract Agent; but, on the request of the Company or the
successor Purchase Contract Agent, such retiring Purchase Contract Agent shall,
upon payment of its charges, execute and deliver an instrument transferring to
such successor Purchase Contract Agent all the rights, powers and trusts of the
retiring Purchase Contract Agent and shall duly assign, transfer and deliver to
such successor Purchase Contract Agent all property and money held by such
retiring Purchase Contract Agent hereunder.
(b) Upon request of any such successor Purchase Contract Agent, the Company
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Purchase Contract Agent all such rights, powers
and agencies referred to in paragraph (a) of this Section.
(c) No successor Purchase Contract Agent shall accept its appointment
unless at the time of such acceptance such successor Purchase Contract Agent
shall be qualified and eligible under this Article.
Section VII.11. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Purchase Contract Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Purchase Contract
Agent shall be a party, or any corporation succeeding to all or substantially
all the corporate trust business of the Purchase Contract Agent, shall be the
successor of the Purchase Contract Agent hereunder, provided such corporation
shall be otherwise qualified and eligible under this Article, with the execution
or filing of any paper or any further act on the part of any of the parties
hereto. In case any Certificates shall have been authenticated and executed on
behalf of the Holders, but not delivered, by the Purchase Contract Agent then in
office, any successor by merger, conversion or consolidation to such Purchase
Contract Agent may adopt such authentication and execution and deliver the
Certificates so authenticated and executed with the same effect as if such
successor Purchase Contract Agent had itself authenticated and executed such
Securities.
Section VII.12. Preservation of Information; Communications to Holders.
(a) The Purchase Contract Agent shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders received by the
Purchase Contract Agent in its capacity as Registrar.
(b) If three or more Holders (herein referred to as "applicants") apply in
writing to the Purchase Contract Agent, and furnish to the Purchase Contract
Agent reasonable proof that each such applicant has owned a Security for a
period of at least six months preceding the date of such application, and such
application states that the applicants desire to communicate with other Holders
with respect to their rights under this Agreement or under the Securities and is
accompanied by a copy of the form of proxy or other communication which such
applicants propose to transmit, then the Purchase Contract Agent shall mail to
all the Holders copies of the form of proxy or other communication which is
specified in such request, with reasonable
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promptness after a tender to the Purchase Contract Agent of the materials to be
mailed and of payment, or provision for the payment, of the reasonable expenses
of such mailing.
Section VII.13. No Obligations of Purchase Contract Agent.
Except to the extent otherwise expressly provided in this Agreement, the
Purchase Contract Agent assumes no obligations and shall not be subject to any
liability under this Agreement, the Pledge Agreement or any Purchase Contract in
respect of the obligations of the Holder of any Security thereunder. The
Company agrees, and each Holder of a Certificate, by his acceptance thereof,
shall be deemed to have agreed, that the Purchase Contract Agent's execution of
the Certificates on behalf of the Holders shall be solely as agent and attorney-
in-fact for the Holders, and that the Purchase Contract Agent shall have no
obligation to perform such Purchase Contracts on behalf of the Holders, except
to the extent expressly provided in Article Five hereof. Anything contained in
this Agreement to the contrary notwithstanding, in no event shall the Purchase
Contract Agent or its officers, employees or agents be liable under this
Agreement to any third party for indirect, special, punitive, or consequential
loss or damage of any kind whatsoever, including lost profits, whether or not
the likelihood of such loss or damage was known to the Purchase Contract Agent,
incurred without any act or deed that is found to be attributable to gross
negligence or willful misconduct on the part of the Purchase Contract Agent.
Section VII.14. Tax Compliance.
(a) The Company will comply with all applicable certification, information
reporting and withholding (including "backup" withholding) requirements imposed
by applicable tax laws, regulations or administrative practice with respect to
(i) any payments made with respect to the Securities or (ii) the issuance,
delivery, holding, transfer, redemption or exercise of rights under the
Securities. Such compliance shall include, without limitation, the preparation
and timely filing of required returns and the timely payment of all amounts
required to be withheld to the appropriate taxing authority or its designated
agent.
(b) The Purchase Contract Agent shall comply in accordance with the terms
hereof with any written direction received from the Company with respect to the
execution or certification of any required documentation and the application of
such requirements to particular payments or Holders or in other particular
circumstances, and may for purposes of this Agreement rely on any such direction
in accordance with the provisions of Section 7.1(a)(2) hereof.
(c) The Purchase Contract Agent shall maintain all appropriate records
documenting compliance with such requirements, and shall make such records
available, on written request, to the Company or its authorized representative
within a reasonable period of time after receipt of such request.
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ARTICLE VIII
Supplemental Agreements
Section VIII.1. Supplemental Agreements Without Consent of Holders.
Without the consent of any Holders, the Company and the Purchase Contract
Agent, at any time and from time to time, may enter into one or more agreements
supplemental hereto, in form satisfactory to the Company and the Purchase
Contract Agent, to:
(1) evidence the succession of another Person to the Company, and the
assumption by any such successor of the covenants of the Company herein and
in the Certificates;
(2) evidence and provide for the acceptance of appointment hereunder
by a successor Purchase Contract Agent;
(3) add to the covenants of the Company for the benefit of the
Holders, or surrender any right or power herein conferred upon the Company;
(4) make provision with respect to the rights of Holders pursuant to
the requirements of Section 5.6(b); or
(5) except as provided for in Section 5.6, cure any ambiguity, correct
or supplement any provisions herein which may be inconsistent with any
other provisions herein, or make any other provisions with respect to such
matters or questions arising under this Agreement, provided such action
shall not adversely affect the interests of the Holders.
Section VIII.2. Supplemental Agreements With Consent of Holders.
With the consent of the Holders of not less than a majority of the
outstanding Purchase Contracts voting together as one class, by Act of said
Holders delivered to the Company and the Purchase Contract Agent, the Company,
when authorized by a Board Resolution, and the Purchase Contract Agent may enter
into an agreement or agreements supplemental hereto for the purpose of modifying
in any manner the terms of the Purchase Contracts, or the provisions of this
Agreement or the rights of the Holders in respect of the Securities; provided,
however, that, except as contemplated herein, no such supplemental agreement
shall, without the unanimous consent of the Holders of each outstanding Purchase
Contract affected thereby,
(1) change any Payment Date;
(2) change the amount or the type of Collateral required to be Pledged
to secure a Holder's obligations under the Purchase Contract, impair the
right of the Holder of any Purchase Contract to receive distributions on
the related Collateral or otherwise
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adversely affect the Holder's rights in or to such Collateral or adversely
alter the rights in or to such Collateral;
(3) reduce any Purchase Contract Payments or change any place where,
or the coin or currency in which, any Purchase Contract Payment is payable;
(4) impair the right to institute suit for the enforcement of any
Purchase Contract;
(5) reduce the number of shares of Georgia-Pacific Group Stock to be
purchased pursuant to any Purchase Contract, increase the price to purchase
shares of Georgia-Pacific Group Stock upon settlement of any Purchase
Contract, change the Purchase Contract Settlement Date or otherwise
adversely affect the Holder's rights under any Purchase Contract; or
(6) reduce the percentage of the outstanding Purchase Contracts the
consent of whose Holders is required for any such supplemental agreement;
provided that if any amendment or proposal referred to above would adversely
affect only the PEPS Units or the Treasury PEPS Units, then only the affected
class of Holders as of the record date for the Holders entitled to vote thereon
will be entitled to vote on such amendment or proposal, and such amendment or
proposal shall not be effective except with the consent of Holders of not less
than a majority of such class; and provided, further, that the unanimous consent
of the Holders of each outstanding Purchase Contract of such class affected
thereby shall be required to approve any amendment or proposal specified in
clauses (1) through (6) above.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental agreement, but it shall
be sufficient if such Act shall approve the substance thereof.
Section VIII.3. Execution of Supplemental Agreements.
In executing, or accepting the additional agencies created by, any
supplemental agreement permitted by this Article or the modifications thereby of
the agencies created by this Agreement, the Purchase Contract Agent shall be
provided, and (subject to Section 7.1) shall be fully protected in relying upon,
an Officers' Certificate and an Opinion of Counsel stating that the execution of
such supplemental agreement is authorized or permitted by this Agreement. The
Purchase Contract Agent may, but shall not be obligated to, enter into any such
supplemental agreement which affects the Purchase Contract Agent's own rights,
duties or immunities under this Agreement or otherwise.
Section VIII.4. Effect of Supplemental Agreements.
Upon the execution of any supplemental agreement under this Article, this
Agreement shall be modified in accordance therewith, and such supplemental
agreement shall form a part of
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this Agreement for all purposes; and every Holder of Certificates theretofore or
thereafter authenticated, executed on behalf of the Holders and delivered
hereunder, shall be bound thereby.
Section VIII.5. Reference to Supplemental Agreements.
Certificates authenticated, executed on behalf of the Holders and delivered
after the execution of any supplemental agreement pursuant to this Article may,
and shall if required by the Purchase Contract Agent, bear a notation in form
approved by the Purchase Contract Agent as to any matter provided for in such
supplemental agreement. If the Company shall so determine, new Certificates so
modified as to conform, in the opinion of the Purchase Contract Agent and the
Company, to any such supplemental agreement may be prepared and executed by the
Company and authenticated, executed on behalf of the Holders and delivered by
the Purchase Contract Agent in exchange for Outstanding Certificates.
ARTICLE IX
Merger, Consolidation, Share exchange, Sale or Conveyance
Section IX.1. Covenant Not to Merge, Consolidate, Enter into a Share Exchange,
Sell or Convey Property Except Under Certain Conditions.
The Company covenants that it will not merge, consolidate or enter into a
share exchange with any other Person or sell, assign, transfer, lease or convey
all or substantially all of its properties and assets to any Person or group of
affiliated Persons in one transaction or a series of related transactions,
unless:
(1) either the Company shall be the continuing corporation, or the
successor (if other than the Company) shall be a corporation organized and
existing under the laws of the United States of America or a State thereof
or the District of Columbia and such corporation shall expressly assume all
the obligations of the Company under the Purchase Contracts, this Agreement
and the Pledge Agreement by one or more supplemental agreements in form
reasonably satisfactory to the Purchase Contract Agent and the Collateral
Agent, executed and delivered to the Purchase Contract Agent and the
Collateral Agent by such corporation; and
(2) the Company or such successor corporation, as the case may be,
shall not, immediately after such merger, consolidation or share exchange,
or such sale, assignment, transfer, lease or conveyance, be in default in
the performance of any covenant or condition hereunder, under any of the
Securities or under the Pledge Agreement.
Section IX.2. Rights and Duties of Successor Corporation.
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In case of any such merger, consolidation, share exchange, sale,
assignment, transfer, lease or conveyance and upon any such assumption by a
successor corporation in accordance with Section 9.1, such successor corporation
shall succeed to and be substituted for the Company with the same effect as if
it had been named herein as the Company. Such successor corporation thereupon
may cause to be signed, and may issue either in its own name or in the name of
Georgia-Pacific Corporation, any or all of the Certificates evidencing
Securities issuable hereunder which theretofore shall not have been signed by
the Company and delivered to the Purchase Contract Agent; and, upon the order of
such successor corporation, instead of the Company, and subject to all the
terms, conditions and limitations in this Agreement prescribed, the Purchase
Contract Agent shall authenticate and execute on behalf of the Holders and
deliver any Certificates which previously shall have been signed and delivered
by the officers of the Company to the Purchase Contract Agent for authentication
and execution, and any Certificate evidencing Securities which such successor
corporation thereafter shall cause to be signed and delivered to the Purchase
Contract Agent for that purpose. All the Certificates issued shall in all
respects have the same legal rank and benefit under this Agreement as the
Certificates theretofore or thereafter issued in accordance with the terms of
this Agreement as though all of such Certificates had been issued at the date of
the execution hereof.
In case of any such merger, consolidation, share exchange, sale,
assignment, transfer, lease or conveyance such change in phraseology and form
(but not in substance) may be made in the Certificates evidencing Securities
thereafter to be issued as may be appropriate.
Section IX.3. Officers' Certificate and Opinion of Counsel Given to Purchase
Contract Agent'.
The Purchase Contract Agent, subject to Sections 7.1 and 7.3, shall receive
an Officers' Certificate and an Opinion of Counsel as conclusive evidence that
any such merger, consolidation, share exchange, sale, assignment, transfer,
lease or conveyance, and any such assumption, complies with the provisions of
this Article and that all conditions precedent to the consummation of any such
merger, consolidation, share exchange, sale, assignment, transfer, lease or
conveyance have been met.
ARTICLE X
Covenants
Section X.1. Performance Under Purchase Contracts.
The Company covenants and agrees for the benefit of the Holders from time
to time of the Securities that it will duly and punctually perform its
obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.
Section X.2. Maintenance of Office or Agency.
The Company will maintain in the Borough of Manhattan, New York City an
office or agency where Certificates may be presented or surrendered for
acquisition of shares of Georgia-
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Pacific Group Stock upon settlement of the Purchase Contracts on the Purchase
Contract Settlement Date or Early Settlement and for transfer of Collateral upon
occurrence of a Termination Event, where Certificates may be surrendered for
registration of transfer or exchange, for a Collateral Substitution or
reestablishment of PEPS Units and where notices and demands to or upon the
Company in respect of the Securities and this Agreement may be served. The
Company will give prompt written notice to the Purchase Contract Agent of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Purchase Contract Agent with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office, and the Company hereby appoints the Purchase Contract
Agent as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more other offices
or agencies where Certificates may be presented or surrendered for any or all
such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, New York City for such purposes. The Company will give prompt
written notice to the Purchase Contract Agent of any such designation or
rescission and of any change in the location of any such other office or agency.
The Company hereby designates as the place of payment for the Securities the
Corporate Trust Office and appoints the Purchase Contract Agent at its Corporate
Trust Office as paying agent in such city.
Section X.3. Company to Reserve Georgia-Pacific Group Stock.
The Company shall at all times prior to the Purchase Contract Settlement
Date reserve and keep available, free from preemptive rights, out of its
authorized but unissued Georgia-Pacific Group Stock the full number of shares of
Georgia-Pacific Group Stock issuable against tender of payment in respect of all
Purchase Contracts constituting a part of the Securities evidenced by
Outstanding Certificates.
Section X.4. Covenants as to Georgia-Pacific Group Stock.
The Company covenants that all shares of Georgia-Pacific Group Stock which
may be issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Securities will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable.
Section X.5. Statements of Officers of the Company as to Default.
The Company will deliver to the Purchase Contract Agent, within 120 days
after the end of each fiscal year of the Company (which as of the date hereof is
December 31) ending after the date hereof, an Officers' Certificate (one of the
signers of which shall be the principal executive officer, principal financial
officer or principal accounting officer of the Company), stating whether or not
to the knowledge of the signers thereof the Company is in default in the
performance and observance of any of the terms, provisions and conditions
hereof, and if the
66
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Company shall be in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge.
Section X.6. ERISA.
Each Holder from time to time of the PEPS Units which is a Plan hereby
represents that its acquisition of the PEPS Units and the holding of the same
satisfies the applicable fiduciary requirements of ERISA and that it is entitled
to exemption relief from the prohibited transaction provisions of ERISA and the
Code in accordance with one or more prohibited transaction exemptions or
otherwise will not result in a nonexempt prohibited transaction.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
GEORGIA-PACIFIC CORPORATION
By: ______________________________________
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO, as
Purchase Contract Agent
By: ______________________________________
Name:
Title:
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EXHIBIT A
FACE OF PEPS UNITS CERTIFICATE
THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE PURCHASE
CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"), OR A
NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR CERTIFICATES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT AND NO
TRANSFER OF THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS CERTIFICATE AS A
WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
No. _______ Cusip No. 373298801
Number of PEPS Units ________
GEORGIA-PACIFIC CORPORATION
PEPS UNITS
This PEPS Units Certificate certifies that Cede & Co. is the registered
Holder of the number of PEPS Units set forth above. Each PEPS Unit consists of
(i) the beneficial ownership by the Holder of one Senior Deferrable Note (the
"Senior Deferrable Note") of Georgia-Pacific Corporation, a Georgia corporation
(the "Company"), having a principal amount of $50, subject to the Pledge of such
Senior Deferrable Note by such Holder pursuant to the Pledge Agreement, and (ii)
the rights and obligations of the Holder under one Purchase Contract with the
Company. All capitalized terms used herein which are defined in the Purchase
Contract Agreement (as defined on the reverse hereof) have the meaning set forth
therein.
Pursuant to the Pledge Agreement, the Senior Deferrable Note constituting
part of each PEPS Unit evidenced hereby has been pledged to the Collateral
Agent, for the benefit of the
<PAGE>
Company, to secure the obligations of the Holder under the Purchase Contract
comprising part of such PEPS Unit.
Payments of interest on any Senior Deferrable Note forming part of a PEPS
Unit evidenced hereby, shall, subject to receipt thereof by the Purchase
Contract Agent from the Securities Intermediary, be paid to the Person in whose
name this PEPS Units Certificate (or a Predecessor PEPS Units Certificate) is
registered at the close of business on the Record Date for such Payment Date.
Interest is payable quarterly in arrears on February 16, May 16, August 16 and
November 16 of each year, commencing November 16, 1999 (each, a "Payment Date").
The Company may, at its option, defer payments of interest.
Each Purchase Contract evidenced hereby obligates the Holder of this PEPS
Units Certificate to purchase, and the Company to sell, on the Purchase Contract
Settlement Date, at a price equal to $50 (the "Stated Amount"), a number of
shares of Georgia-Pacific Group Common Stock, par value $.80 per share
("Georgia-Pacific Group Stock"), equal to the Settlement Rate, unless prior to
or on the Purchase Contract Settlement Date there shall have occurred a
Termination Event or an Early Settlement with respect to the PEPS Unit of which
such Purchase Contract is a part, all as provided in the Purchase Contract
Agreement and more fully described on the reverse hereof. The purchase price
(the "Purchase Price") for the shares of Georgia-Pacific Group Stock purchased
pursuant to each Purchase Contract evidenced hereby, if not paid earlier, shall
be paid on the Purchase Contract Settlement Date by cash or by application of
payment received in respect of the principal amount with respect to each Pledged
Senior Deferrable Note pursuant to the Remarketing pledged to secure the
obligations under such Purchase Contract of the Holder of the PEPS Unit of which
such Purchase Contract is a part.
The Company shall pay, on each Payment Date, in respect of each Purchase
Contract forming part of a PEPS Unit evidenced hereby, an amount (the "Purchase
Contract Payments") equal to .% per annum of the Stated Amount. Such Purchase
Contract Payments shall be payable to the Person in whose name this PEPS Units
Certificate (or a Predecessor PEPS Units Certificate) is registered at the close
of business on the Record Date for such Payment Date. The Company may, at its
option, defer Purchase Contract Payments.
Interest payments on the Senior Deferrable Notes and Purchase Contract
Payments will be payable at the office of the Purchase Contract Agent in New
York City or, at the option of the Company, by check mailed to the address of
the Person entitled thereto as such address appears on the PEPS Units Register.
Reference is hereby made to the further provisions set forth on the reverse
hereof, which further provisions shall for all purposes have the same effect as
if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Purchase Contract Agent by manual signature, this PEPS Units Certificate shall
not be entitled to any benefit under the Pledge Agreement or the Purchase
Contract Agreement or be valid or obligatory for any purpose.
A-2
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IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
GEORGIA-PACIFIC CORPORATION
By: ______________________________________
Name:
Title:
By: ______________________________________
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations
of such Holder under the Purchase Contracts
evidenced hereby)
By: The First National Bank of Chicago,
not individually but solely as
Attorney-in-Fact of such Holder
By: ______________________________________
Name:
Title:
Dated:
A-3
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CERTIFICATE OF AUTHENTICATION OF
PURCHASE CONTRACT AGENT
This is one of the PEPS Units Certificates referred to in the within
mentioned Purchase Contract Agreement.
By: THE FIRST NATIONAL BANK OF CHICAGO, as
Purchase Contract Agent
By: ______________________________________
Authorized Officer
Dated:
A-4
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(FORM OF REVERSE OF PEPS UNITS CERTIFICATE)
Each Purchase Contract evidenced hereby is governed by a Purchase Contract
Agreement, dated as of July 7, 1999 (as may be supplemented from time to time,
the "Purchase Contract Agreement"), between the Company and The First National
Bank of Chicago, as Purchase Contract Agent (including its successors hereunder,
the "Purchase Contract Agent"), to which Purchase Contract Agreement and
supplemental agreements thereto reference is hereby made for a description of
the respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Purchase Contract Agent, the Company, and the Holders and of
the terms upon which the PEPS Units Certificates are, and are to be, executed
and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this PEPS
Units Certificate to purchase, and the Company to sell, on the Purchase Contract
Settlement Date at a price equal to the Stated Amount (the "Purchase Price"), a
number of shares of Georgia-Pacific Group Stock equal to the Settlement Rate,
unless, prior to or on the Purchase Contract Settlement Date, there shall have
occurred a Termination Event with respect to the Security of which such Purchase
Contract is a part or an Early Settlement shall have occurred. The "Settlement
Rate" is equal to:
(1) if the Applicable Market Value (as defined below) is equals or
exceeds $. (the "Threshold Appreciation Price"), . shares of Georgia-
Pacific Group Stock per Purchase Contract;
(2) if the Applicable Market Value is less than the Threshold
Appreciation Price but greater than $. (the "Reference Price"), the number
of shares of Georgia-Pacific Group Stock per Purchase Contract having a
value, based on the Applicable Market Value, equal to the Stated Amount;
and
(3) if the Applicable Market Amount is less than or equal to the
Reference Price, . shares of Georgia-Pacific Group Stock per Purchase
Contract,
in each case subject to adjustment as provided in the Purchase Contract
Agreement.
No fractional shares of Georgia-Pacific Group Stock will be issued upon
settlement of Purchase Contracts, as provided in Section 5.11 of the Purchase
Contract Agreement.
Each Purchase Contract evidenced hereby, which is settled either through
Early Settlement or Cash Settlement, shall obligate the Holder of the related
PEPS Unit to purchase at the Purchase Price, and the Company to sell, a number
of shares of Georgia-Pacific Group Stock equal to the Early Settlement Rate or
the Settlement Rate, as applicable.
The "Applicable Market Value" means the average of the Closing Price per
share of Georgia-Pacific Group Stock on each of the 20 consecutive Trading Days
ending on the third Trading Day immediately preceding the Purchase Contract
Settlement Date.
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The "Closing Price" per share of Georgia-Pacific Group Stock on any date of
determination means:
(1) the closing sale price (or, if no closing price is reported, the
last reported sale price) per share on the New York Stock Exchange, Inc.
(the "NYSE") on such date;
(2) if Georgia-Pacific Group Stock is not listed for trading on the
NYSE on any such date, the closing sale price per share as reported in the
composite transactions for the principal United States securities exchange
on which Georgia-Pacific Group Stock is so listed;
(3) if Georgia-Pacific Group Stock is not so listed on a United States
national or regional securities exchange, the closing sale price per share
as reported by The Nasdaq Stock Market, Inc.;
(4) if Georgia-Pacific Group Stock is not so reported, the last quoted
bid price for Georgia-Pacific Group Stock in the over-the-counter market as
reported by the National Quotation Bureau or similar organization; or
(5) if such bid price is not available, the average of the mid-point
of the last bid and ask prices of Georgia-Pacific Group Stock on such date
from at least three nationally recognized independent investment banking
firms retained for this purpose by the Company.
A "Trading Day" means a day on which Georgia-Pacific Group Stock (1) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (2) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of Georgia-Pacific Group Stock.
In accordance with the terms of the Purchase Contract Agreement, the Holder
of this PEPS Units Certificate may pay the Purchase Price for the shares of
Georgia-Pacific Group Stock purchased pursuant to each Purchase Contract
evidenced hereby by effecting a Cash Settlement or an Early Settlement or a
Remarketing of the related Pledged Senior Deferrable Notes. A Holder of PEPS
Units who does not effect, on or prior to 11:00 a.m. (New York City time) on the
fifth Business Day immediately preceding the Purchase Contract Settlement Date,
an effective Cash Settlement or an Early Settlement, shall pay the Purchase
Price for the shares of Georgia-Pacific Group Stock to be delivered under the
related Purchase Contract from the proceeds of the sale of the related Pledged
Notes held by the Collateral Agent. Such sale will be made by the Remarketing
Agent pursuant to the terms of the Remarketing Agreement on the third Business
Day prior to the Purchase Contract Settlement Date. If, as provided in the
Purchase Contract Agreement, upon the occurrence of a Failed Remarketing, the
Collateral Agent, for the benefit of the Company, exercises its rights as a
secured creditor with respect to the Pledged Senior Deferrable Notes related to
this PEPS Units certificate, any accrued and
A-6
<PAGE>
unpaid or deferred interest payments on such Pledged Senior Deferrable Notes
will become payable by the Company to the holder of this PEPS Units Certificate
in the manner provided for in the Purchase Contract Agreement.
In the event the Company sells, transfers, assigns or otherwise disposes
of all of the properties and assets of the Georgia-Pacific Group and determines
to redeem all of the outstanding shares of Georgia-Pacific Group Stock, or
redeems all of the shares of Georgia-Pacific Group Stock for shares of common
stock of one or more of its wholly owned subsidiaries which own all of the
assets and liabilities attributed to the Georgia-Pacific Group, the Purchase
Contract Settlement Date and Remarketing Date shall be accelerated to five
Business Days immediately preceding the Redemption Date or Spin-Off Date, as the
case may be.
The Company shall not be obligated to issue any shares of Georgia-Pacific
Group Stock in respect of a Purchase Contract or deliver any certificates
therefor to the Holder unless it shall have received payment of the aggregate
purchase price for the shares of Georgia-Pacific Group Stock to be purchased
thereunder in the manner herein set forth.
Under the terms of the Pledge Agreement, the Purchase Contract Agent will
be entitled to exercise the voting and any other consensual rights pertaining to
the Pledged Senior Deferrable Notes. Upon receipt of notice of any meeting at
which holders of Senior Deferrable Notes are entitled to vote or upon the
solicitation of consents, waivers or proxies of holders of Senior Deferrable
Notes, the Purchase Contract Agent shall, as soon as practicable thereafter,
mail to the PEPS Units Holders a notice:
(1) containing such information as is contained in the notice or
solicitation;
(2) stating that each PEPS Unit Holder on the record date set by the
Purchase Contract Agent therefor (which, to the extent possible, shall be
the same date as the record date for determining the holders of Senior
Deferrable Notes entitled to vote) shall be entitled to instruct the
Purchase Contract Agent as to the exercise of the voting rights pertaining
to the Senior Deferrable Notes constituting a part of such Holder's PEPS
Unit; and
(3) stating the manner in which such instructions may be given.
Upon the written request of the PEPS Unit Holders on such record date, the
Purchase Contract Agent shall endeavor insofar as practicable to vote or cause
to be voted, in accordance with the instructions set forth in such requests, the
maximum number of Senior Deferrable Notes as to which any particular voting
instructions are received. In the absence of specific instructions from the
Holder of a PEPS Unit, the Purchase Contract Agent shall abstain from voting the
Senior Deferrable Notes evidenced by such PEPS Unit.
The PEPS Certificates are issuable only in registered form and only in
denominations of a single PEPS Unit and any integral multiple thereof. The
transfer of any PEPS Units Certificate
A-7
<PAGE>
will be registered and PEPS Units Certificates may be exchanged as provided in
the Purchase Contract Agreement. The PEPS Units Registrar may require a Holder,
among other things, to furnish appropriate endorsements and transfer documents
permitted by the Purchase Contract Agreement. No service charge shall be
required for any such registration of transfer or exchange, but the Company and
the Purchase Contract Agent may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith. A holder who
elects to substitute a Treasury Security for Senior Deferrable Notes, thereby
creating Treasury PEPS Units, shall be responsible for any fees or expenses
payable in connection therewith. Except as provided in the Purchase Contract
Agreement, for so long as the Purchase Contract underlying a PEPS Unit remains
in effect, such PEPS Unit shall not be separable into its constituent parts, and
the rights and obligations of the Holder of such PEPS Unit in respect of the
Senior Deferrable Note and Purchase Contract constituting such PEPS Unit may be
transferred and exchanged only as a PEPS Unit.
The Holder of PEPS Units may substitute for the Pledged Senior Deferrable
Notes securing such Holder's obligations under the related Purchase Contracts
Treasury Securities in an aggregate principal amount equal to the aggregate
principal amount of the Pledged Senior Deferrable Notes in accordance with the
terms of the Purchase Contract Agreement and the Pledge Agreement. From and
after such Collateral Substitution, each Security for which such Pledged
Treasury Securities secures the Holder's obligation under the Purchase Contract
shall be referred to as a "Treasury PEPS Unit". A Holder may make such
Collateral Substitution only in integral multiples of 20 PEPS Units for 20
Treasury PEPS Units. Such Collateral Substitution may cause the equivalent
aggregate principal amount of this Certificate to be increased or decreased;
provided, however, this PEPS Units Certificate shall not represent more than
4,000,000 PEPS Units. All such adjustments to the equivalent aggregate
principal amount of this PEPS Units Certificate shall be duly recorded by
placing an appropriate notation on the Schedule attached hereto.
A Holder of Treasury PEPS Units may recreate PEPS Units by delivering to
the Securities Intermediary with an aggregate principal amount, in the case of
such Senior Deferrable Notes equal to the aggregate principal amount of the
Pledged Treasury Securities in exchange for the release of such Pledged Treasury
Securities in accordance with the terms of the Purchase Contract Agreement and
the Pledge Agreement.
The Company shall pay, on each Payment Date, the Purchase Contract Payments
payable in respect of each Purchase Contract to the Person in whose name the
PEPS Units Certificate evidencing such Purchase Contract is registered at the
close of business on the Record Date for such Payment Date. Purchase Contract
Payments will be payable at the office of the Purchase Contract Agent in New
York City or, at the option of the Company, by check mailed to the address of
the Person entitled thereto at such address as it appears on the PEPS Units
Register.
The Company has the right to defer payment of all or part of the Purchase
Contract Payments in respect of each Purchase Contract until no later than the
Purchase Contract Settlement Date. If the Company so elects to defer Purchase
Contract Payments, the Company shall pay additional Purchase Contract Payments
on such deferred installments of Purchase
<PAGE>
Contract Payments at a rate equal to .% per annum, compounding quarterly, until
such deferred installments are paid. If a Holder effects an Early Settlement or
if a Termination Event shall occur, such Holder will have no right to receive
any accrued and unpaid or deferred Purchase Contract Payments.
The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Purchase Contract
Payments, shall immediately and automatically terminate, without the necessity
of any notice or action by any Holder, the Purchase Contract Agent or the
Company, if, on or prior to the Purchase Contract Settlement Date, a Termination
Event shall have occurred. Upon the occurrence of a Termination Event, the
Company shall promptly but in no event later than two Business Days thereafter
give written notice to the Purchase Contract Agent, the Collateral Agent and the
Holders, at their addresses as they appear in the PEPS Units Register. Upon and
after the occurrence of a Termination Event, the Collateral Agent shall release
the Senior Deferrable Notes from the Pledge in accordance with the provisions of
the Pledge Agreement. A PEPS Unit shall thereafter represent the right to
receive the Senior Deferrable Note forming a part of such PEPS Unit in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement.
Subject to and upon compliance with the provisions of the Purchase Contract
Agreement, at the option of the Holder thereof, Purchase Contracts underlying
Securities may be settled early ("Early Settlement") as provided in the Purchase
Contract Agreement. In order to exercise the right to effect Early Settlement
with respect to any Purchase Contracts evidenced by this PEPS Units Certificate,
the Holder of this PEPS Units Certificate shall deliver this PEPS Units
Certificate to the Purchase Contract Agent at the Corporate Trust Office duly
endorsed for transfer to the Company or in blank with the form of Election to
Settle Early set forth below duly completed and accompanied by payment in the
form of immediately available funds payable to the order of the Company in an
amount (the "Early Settlement Amount") equal to:
(1) the product of (A) the Stated Amount times (B) the number of
Purchase Contracts with respect to which the Holder has elected to effect
Early Settlement, plus
(2) if such delivery is made with respect to any Purchase Contracts
during the period from the close of business on any Record Date for any
Payment Date to the opening of business on such Payment Date, an amount
equal to the Purchase Contract Payments payable on such Payment Date with
respect to such Purchase Contracts.
Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the Pledged Senior Deferrable Notes underlying such Securities shall
be released from the Pledge as provided in the Pledge Agreement and the Holder
shall be entitled to receive a number of shares of Georgia-Pacific Group Stock
on account of each Purchase Contract forming part of a PEPS Unit as to which
Early Settlement is effected equal to the Early Settlement Rate. The Early
Settlement Rate shall initially be equal to . shares of Georgia-Pacific Group
Stock and shall be adjusted in the same manner and at the same time as the
Settlement Rate is adjusted as provided in the Purchase Contract Agreement.
A-9
<PAGE>
Upon registration of transfer of this PEPS Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Purchase Contract Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this PEPS Units Certificate. The Company covenants and agrees, and
the Holder, by its acceptance hereof, likewise covenants and agrees, to be bound
by the provisions of this paragraph.
The Holder of this PEPS Units Certificate, by its acceptance hereof,
authorizes the Purchase Contract Agent to enter into and perform the related
Purchase Contracts forming part of the PEPS Units evidenced hereby on its behalf
as its attorney-in-fact, expressly withholds any consent to the assumption
(i.e., affirmance) of the Purchase Contracts by the Company or its trustee in
the event that the Company becomes the subject of a case under the Bankruptcy
Code, agrees to be bound by the terms and provisions thereof, covenants and
agrees to perform his obligations under such Purchase Contracts, consents to the
provisions of the Purchase Contract Agreement, authorizes the Purchase Contract
Agent to enter into and perform the Purchase Contract Agreement and the Pledge
Agreement on its behalf as its attorney-in-fact, and consents to the Pledge of
the Senior Deferrable Notes underlying this PEPS Units Certificate pursuant to
the Pledge Agreement. The Holder further covenants and agrees that, to the
extent and in the manner provided in the Purchase Contract Agreement and the
Pledge Agreement, but subject to the terms thereof, payments in respect to the
aggregate principal amount of the Pledged Senior Deferrable Notes, on the
Purchase Contract Settlement Date shall be paid by the Collateral Agent to the
Company in satisfaction of such Holder's obligations under such Purchase
Contract and such Holder shall acquire no right, title or interest in such
payments.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall be governed by, and construed in accordance
with, the laws of the State of New York.
The Company, the Purchase Contract Agent and its Affiliates and any agent
of the Company or the Purchase Contract Agent may treat the Person in whose name
this PEPS Units Certificate is registered as the owner of the PEPS Units
evidenced hereby for the purpose of receiving payments of interest payable
quarterly on the Senior Deferrable Notes, receiving payments of Purchase
Contract Payments, performance of the Purchase Contracts and for all other
purposes whatsoever, whether or not any payments in respect thereof be overdue
and notwithstanding any notice to the contrary, and neither the Company, the
Purchase Contract Agent nor any such agent shall be affected by notice to the
contrary.
The Purchase Contracts shall not, prior to the settlement thereof, entitle
the Holder to any of the rights of a holder of shares of Georgia-Pacific Group
Stock.
A-10
<PAGE>
A copy of the Purchase Contract Agreement is available for inspection at
the offices of the Purchase Contract Agent.
A-11
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM:
as tenants in common
UNIF GIFT MIN ACT:
---------------Custodian---------------
(cust) (minor)
Under Uniform Gifts to Minors Act of
-------
--------------------------------------------
TEN ENT: as tenants by the entireties
JT TEN: as joint tenants with right of survivorship
and not as tenants in common
Additional abbreviations may also be used though not in the above list.
-------------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within PEPS Units Certificates and all rights thereunder, hereby irrevocably
constituting and appointing attorney to transfer said PEPS Units Certificates on
the books of Georgia-Pacific Corporation with full power of substitution in the
premises.
Dated:
------------------- -----------------------------------------
Signature
NOTICE: The signature to this assignment
must correspond with the name as it
appears upon the face of the within PEPS
Units Certificates in every particular,
without alteration or enlargement or any
change whatsoever.
Signature Guarantee:
-----------------------------------
A-12
<PAGE>
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Georgia-
Pacific Group Stock deliverable upon settlement on or after the Purchase
Contract Settlement Date of the Purchase Contracts underlying the number of PEPS
Units evidenced by this PEPS Units Certificate be registered in the name of, and
delivered, together with a check in payment for any fractional share, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.
Dated:
------------ --------------------------------------
Signature
Signature Guarantee:
-----------------
(if assigned to another person)
If shares are to be registered in the
name of and delivered to a Person other REGISTERED HOLDER
than the Holder, please (i) print such
Person's name and address and (ii)
provide a guarantee of your signature:
Please print name and address of
Registered Holder:
- ------------------------------------- -------------------------------------
Name Name
- ------------------------------------- -------------------------------------
Address Address
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
Social Security or other
Taxpayer Identification
Number, if any
-------------------------------------
A-13
<PAGE>
ELECTION TO SETTLE EARLY
The undersigned Holder of this PEPS Units Certificate hereby irrevocably
exercises the option to effect Early Settlement in accordance with the terms of
the Purchase Contract Agreement with respect to the Purchase Contracts
underlying the number of PEPS Units evidenced by this PEPS Units Certificate
specified below. The undersigned Holder directs that a certificate for shares
of Georgia-Pacific Group Stock deliverable upon such Early Settlement be
registered in the name of, and delivered, together with a check in payment for
any fractional share and any PEPS Units Certificate representing any PEPS Units
evidenced hereby as to which Early Settlement of the related Purchase Contracts
is not effected, to the undersigned at the address indicated below unless a
different name and address have been indicated below. Pledged Senior Deferrable
Notes deliverable upon such Early Settlement will be transferred in accordance
with the transfer instructions set forth below. If shares are to be registered
in the name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.
Dated:
---------------- -----------------------------------
Signature
Signature Guarantee:
-------------------------------------
A-14
<PAGE>
Number of Securities evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected:
If shares of Georgia-Pacific Group REGISTERED HOLDER
Stock or PEPS Units Certificates are
to be registered in the name of and
delivered to and Pledged Senior
Deferrable Notes are to be transferred
to a Person other than the Holder,
please print such Person's name and
address:
Please print name and address of
Registered Holder:
- ------------------------------------- -------------------------------------
Name Name
- ------------------------------------- -------------------------------------
Address Address
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
Social Security or other
Taxpayer Identification
Number, if any
-------------------------------------
A-15
<PAGE>
Transfer Instructions for Pledged Senior Deferrable Notes Transferable Upon
Early Settlement or a Termination Event:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
A-16
<PAGE>
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have been made:
<TABLE>
<CAPTION>
============================================================================================================================
Number of PEPS Units
Amount of decrease in Amount of decrease in evidenced by this
Number of PEPS Units Number of PEPS Units Global Certificate Signature of authorized
evidenced by the evidenced by the following such officer of Trustee or
Date Global Certificate Global Certificate decrease or increase Securities Custodian
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
=============================================================================================================================
</TABLE>
A-17
<PAGE>
EXHIBIT B
FACE OF TREASURY PEPS CERTIFICATE
THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE PURCHASE
CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"), OR A
NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR CERTIFICATES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT AND NO
TRANSFER OF THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS CERTIFICATE AS A
WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
No. _____ Cusip No. 373298884
Number of Treasury PEPS Units _________
GEORGIA-PACIFIC CORPORATION
TREASURY PEPS UNITS
This Treasury PEPS Units Certificate certifies that Cede & Co. is the
registered Holder of the number of Treasury PEPS Units set forth above. Each
Treasury PEPS Unit consists of (i) a 1/20 undivided beneficial ownership
interest of a Treasury Security having a principal amount at maturity equal to
$1,000, subject to the Pledge of such Treasury Security by such Holder pursuant
to the Pledge Agreement, and (ii) the rights and obligations of the Holder under
one Purchase Contract with Georgia-Pacific Corporation, a Georgia corporation
(the "Company"). All capitalized terms used herein which are defined in the
Purchase Contract Agreement (as defined on the reverse hereof) have the meaning
set forth therein.
<PAGE>
Pursuant to the Pledge Agreement, the Treasury Securities constituting part
of each Treasury PEPS Unit evidenced hereby have been pledged to the Collateral
Agent, for the benefit of the Company, to secure the obligations of the Holder
under the Purchase Contract comprising part of such Treasury PEPS Unit.
Each Purchase Contract evidenced hereby obligates the Holder of this
Treasury PEPS Units Certificate to purchase, and the Company, to sell, on the
Purchase Contract Settlement Date, at a price equal to $50 (the "Stated
Amount"), a number of shares of Georgia-Pacific Group Common Stock, par value
$.80 per share ("Georgia-Pacific Group Stock"), equal to the Settlement Rate,
unless prior to or on the Purchase Contract Settlement Date there shall have
occurred a Termination Event or an Early Settlement with respect to the Treasury
PEPS Unit of which such Purchase Contract is a part, all as provided in the
Purchase Contract Agreement and more fully described on the reverse hereof. The
purchase price (the "Purchase Price") for the shares of Georgia-Pacific Group
Stock purchased pursuant to each Purchase Contract evidenced hereby, if not paid
earlier, shall be paid on the Purchase Contract Settlement Date by application
of the proceeds from the Treasury Securities at maturity pledged to secure the
obligations of the Holder under such Purchase Contract of the Treasury PEPS Unit
of which such Purchase Contract is a part.
The Company shall pay, quarterly in arrears on February 16, May 16, August
16 and November 16, commencing November 16, 1999 (each, a "Payment Date"), in
respect of each Purchase Contract evidenced hereby an amount (the "Purchase
Contract Payments") equal to .% per annum of the Stated Amount. Such Purchase
Contract Payments shall be payable to the Person in whose name this Treasury
PEPS Units Certificate (or a Predecessor Treasury PEPS Units Certificate) is
registered at the close of business on the Record Date for such Payment Date.
The Company may, at its option, defer Purchase Contract Payments.
Purchase Contract Payments will be payable at the office of the Purchase
Contract Agent in New York City or, at the option of the Company, by check
mailed to the address of the Person entitled thereto as such address appears on
the Treasury PEPS Units Register.
Reference is hereby made to the further provisions set forth on the reverse
hereof, which further provisions shall for all purposes have the same effect as
if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Purchase Contract Agent by manual signature, this Treasury PEPS Units
Certificate shall not be entitled to any benefit under the Pledge Agreement or
the Purchase Contract Agreement or be valid or obligatory for any purpose.
B-2
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
GEORGIA-PACIFIC CORPORATION
By: _______________________________
Name:
Title:
By: _______________________________
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under
the Purchase Contracts)
By: The First National Bank of
Chicago, not individually but
solely as Attorney-in-Fact
of such Holder
By: _______________________________
Name:
Title:
Dated:
B-3
<PAGE>
CERTIFICATE OF AUTHENTICATION OF
PURCHASE CONTRACT AGENT
This is one of the Treasury PEPS Units referred to in the within-mentioned
Purchase Contract Agreement.
By: THE FIRST NATIONAL BANK OF
CHICAGO, as Purchase
Contract Agent
By: ____________________________
Authorized Officer
Dated:
B-4
<PAGE>
(REVERSE OF TREASURY PEPS UNITS CERTIFICATE)
Each Purchase Contract evidenced hereby is governed by a Purchase Contract
Agreement, dated as of July 7, 1999 (as may be supplemented from time to time,
the "Purchase Contract Agreement") between the Company and The First National
Bank of Chicago, as Purchase Contract Agent (including its successors
thereunder, herein called the "Purchase Contract Agent"), to which the Purchase
Contract Agreement and supplemental agreements thereto reference is hereby made
for a description of the respective rights, limitations of rights, obligations,
duties and immunities thereunder of the Purchase Contract Agent, the Company and
the Holders and of the terms upon which the Treasury PEPS Units Certificates
are, and are to be, executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Treasury PEPS Units Certificate to purchase, and the Company to sell, on the
Purchase Contract Settlement Date at a price equal to the Stated Amount (the
"Purchase Price") a number of shares of Georgia-Pacific Group Stock equal to the
Settlement Rate, unless prior to the Purchase Contract Settlement Date, there
shall have occurred a Termination Event with respect to the Security of which
such Purchase Contract is a part or an Early Settlement shall have occurred.
The "Settlement Rate" is equal to:
(1) if the Applicable Market Value (as defined below) is equals or
exceeds $. (the "Threshold Appreciation Price"), . shares of Georgia-
Pacific Group Stock per Purchase Contract;
(2) if the Applicable Market Value is less than the Threshold
Appreciation Price but greater than $. (the "Reference Price"), the number
of shares of Georgia-Pacific Group Stock per Purchase Contract having a
value, based on the Applicable Market Value, equal to the Stated Amount;
and
(3) if the Applicable Market Amount is less than or equal to the
Reference Price, . shares of Georgia-Pacific Group Stock per Purchase
Contract,
in each case subject to adjustment as provided in the Purchase Contract
Agreement.
No fractional shares of Georgia-Pacific Group Stock will be issued upon
settlement of Purchase Contracts, as provided in Section 5.11 of the Purchase
Contract Agreement.
Each Purchase Contract evidenced hereby, which is settled either through
Early Settlement or Cash Settlement, shall obligate the Holder of the related
Treasury PEPS Unit to purchase at the Purchase Price for cash, and the Company
to sell, a number of shares of Georgia-Pacific Group Stock equal to the Early
Settlement Rate or the Settlement Rate, as applicable.
The "Applicable Market Value" means the average of the Closing Prices per
share of Georgia-Pacific Group Stock on each of the 20 consecutive Trading Days
ending on the third Trading Day immediately preceding the Purchase Contract
Settlement Date.
B-5
<PAGE>
The "Closing Price" per share of Georgia-Pacific Group Stock on any date of
determination means the:
(1) closing sale price (or, if no closing price is reported, the last
reported sale price) per share on the New York Stock Exchange, Inc. (the
"NYSE") on such date;
(2) if Georgia-Pacific Group Stock is not listed for trading on the
NYSE on any such date, the closing sale price per share as reported in the
composite transactions for the principal United States securities exchange
on which Georgia-Pacific Group Stock is so listed;
(3) if Georgia-Pacific Group Stock is not so listed on a United States
national or regional securities exchange, the closing sale price per share
as reported by The Nasdaq Stock Market, Inc.;
(4) if Georgia-Pacific Group Stock is not so reported, the last quoted
bid price for Georgia-Pacific Group Stock in the over-the-counter market as
reported by the National Quotation Bureau or similar organization; or
(5) if such bid price is not available, the average of the mid-point
of the last bid and ask prices of Georgia-Pacific Group Stock on such date
from at least three nationally recognized independent investment banking
firms retained for this purpose by the Company.
A "Trading Day" means a day on which Georgia-Pacific Group Stock (1) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (2) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of Georgia-Pacific Group Stock.
In accordance with the terms of the Purchase Contract Agreement, the Holder
of this Treasury PEPS Unit shall pay the Purchase Price for the shares of
Georgia-Pacific Group Stock purchased pursuant to each Purchase Contract
evidenced hereby either by effecting a Cash Settlement or an Early Settlement of
each such Purchase Contract or by applying a principal amount of the Pledged
Treasury Securities underlying such Holder's Treasury PEPS Unit equal to the
Stated Amount of such Purchase Contract to the purchase of the Georgia-Pacific
Group Stock. A Holder of Treasury PEPS Unit who does not effect, prior to or on
11:00 a.m. (New York City time) on the Business Day immediately preceding the
Purchase Contract Settlement Date, an effective Cash Settlement or an Early
Settlement, shall pay the Purchase Price for the shares of Georgia-Pacific Group
Stock to be issued under the related Purchase Contract from the proceeds of the
Pledged Treasury Securities.
The Company shall not be obligated to issue any shares of Georgia-Pacific
Group Stock in respect of a Purchase Contract or deliver any certificates
therefor to the Holder unless it shall have received payment of the aggregate
purchase price for the shares of Georgia-Pacific Group Stock to be purchased
thereunder in the manner herein set forth.
B-6
<PAGE>
In the event the Company sells, transfers, assigns or otherwise disposes
of all of the properties and assets of the Georgia-Pacific Group and determines
to redeem all of the outstanding shares of Georgia-Pacific Group Stock, or
redeems all of the shares of Georgia-Pacific Group Stock for shares of common
stock of one or more of its wholly owned subsidiaries which own all of the
assets and liabilities attributed to the Georgia-Pacific Group, the Purchase
Contract Settlement Date and Remarketing Date shall be accelerated to five
Business Days immediately preceding the Redemption Date or Spin-Off Date, as the
case may be.
The Treasury PEPS Units Certificates are issuable only in registered form
and only in denominations of a single Treasury PEPS and any integral multiple
thereof. The transfer of any Treasury PEPS Certificate will be registered and
Treasury PEPS Certificates may be exchanged as provided in the Purchase Contract
Agreement. The Treasury PEPS Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents permitted by
the Purchase Contract Agreement. No service charge shall be required for any
such registration of transfer or exchange, but the Company and the Purchase
Contract Agent may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. A Holder who elects to
substitute Senior Deferrable Notes for Treasury Securities, thereby recreating
PEPS Units, shall be responsible for any fees or expenses associated therewith.
Except as provided in the Purchase Contract Agreement, for so long as the
Purchase Contract underlying a Treasury PEPS Unit remains in effect, such
Treasury PEPS Unit shall not be separable into its constituent parts, and the
rights and obligations of the Holder of such Treasury PEPS Unit in respect of
the Treasury Security and the Purchase Contract constituting such Treasury PEPS
Unit may be transferred and exchanged only as a Treasury PEPS Unit.
A Holder of Treasury PEPS Units may recreate PEPS Units by delivering to
the Collateral Agent Senior Deferrable Notes with a principal amount, in the
case of such Senior Deferrable Notes, equal to the aggregate principal amount at
maturity of the Pledged Treasury Securities in exchange for the release of such
Pledged Treasury Securities in accordance with the terms of the Purchase
Contract Agreement and the Pledge Agreement. From and after such substitution,
the Holder's Security shall be referred to as a "PEPS Unit". Such substitution
may cause the equivalent aggregate principal amount of this Certificate to be
increased or decreased; provided, however, this Treasury PEPS Units Certificate
shall not represent more than 4,000,000 Treasury PEPS Units. All such
adjustments to the equivalent aggregate principal amount of this Treasury PEPS
Units Certificate shall be duly recorded by placing an appropriate notation on
the Schedule attached hereto.
A Holder of PEPS Units may recreate Treasury PEPS Units by delivering to
the Collateral Agent Treasury Securities in an aggregate principal amount equal
to the aggregate principal amount at maturity of the Pledged Senior Deferrable
Notes in exchange for the release of such Pledged Senior Deferrable Notes in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement. Any such recreation of Treasury PEPS Units may be effected only in
multiples of 20 PEPS Units for 20 Treasury PEPS Units.
B-7
<PAGE>
The Company shall pay, on each Payment Date, the Purchase Contract Payments
payable in respect of each Purchase Contract to the Person in whose name the
Treasury PEPS Units Certificate evidencing such Purchase Contract is registered
at the close of business on the Record Date for such Payment Date. Contract
Adjustment Payments will be payable at the office of the Purchase Contract Agent
in New York City or, at the option of the Company, by check mailed to the
address of the Person entitled thereto at such address as it appears on the
Treasury PEPS Units Register.
The Company has the right to defer payment of all or part of the Purchase
Contract Payments in respect of each Purchase Contract until no later than the
Purchase Contract Settlement Date. If the Company so elects to defer Purchase
Contract Payments, the Company shall pay additional Purchase Contract Payments
on such deferred installments of Purchase Contract Payments at a rate equal to
.% per annum, compounding quarterly, until such deferred installments are paid.
If a Holder effects an Early Settlement or if a Termination Event shall occur,
such Holder will have no right to receive any accrued and unpaid or deferred
Purchase Contract Payments.
The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay Contract Adjustment
Payments, shall immediately and automatically terminate, without the necessity
of any notice or action by any Holder, the Purchase Contract Agent or the
Company, if, on or prior to the Purchase Contract Settlement Date, a Termination
Event shall have occurred. Upon the occurrence of a Termination Event, the
Company shall promptly but in no event later than two Business Days thereafter
give written notice to the Purchase Contract Agent, the Collateral Agent and the
Holders, at their addresses as they appear in the Treasury PEPS Units Register.
Upon the occurrence of a Termination Event, the Collateral Agent shall release
the Treasury Securities from the Pledge in accordance with the provisions of the
Pledge Agreement. A Treasury PEPS Unit shall thereafter represent the right to
receive the interest in the Treasury Security forming a part of such Treasury
PEPS Unit, in accordance with the terms of the Purchase Contract Agreement and
the Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase Contract
Agreement, at the option of the Holder thereof, Purchase Contracts underlying
Securities may be settled early ("Early Settlement") as provided in the Purchase
Contract Agreement. In order to exercise the right to effect Early Settlement
with respect to any Purchase Contracts evidenced by this Treasury PEPS Unit, the
Holder of this Treasury PEPS Units Certificate shall deliver this Treasury PEPS
Units Certificate to the Purchase Contract Agent at the Corporate Trust Office
duly endorsed for transfer to the Company or in blank with the form of Election
to Settle Early set forth below duly completed and accompanied by payment in the
form of immediately available funds payable to the order of the Company in an
amount (the "Early Settlement Amount") equal to:
(1) the product of (A) $50 times (B) the number of Purchase Contracts
with respect to which the Holder has elected to effect Early Settlement,
plus
B-8
<PAGE>
(2) if such delivery is made with respect to any Purchase Contracts
during the period from the close of business on any Record Date for any
Payment Date to the opening of business on such Payment Date, an amount
equal to the Contract Adjustment Payments payable, if any, on such Payment
Date with respect to such Purchase Contracts.
Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the Pledged Treasury Securities underlying such Securities shall be
released from the Pledge as provided in the Pledge Agreement and the Holder
shall be entitled to receive a number of shares of Georgia-Pacific Group Stock
on account of each Purchase Contract forming part of a Treasury PEPS Unit as to
which Early Settlement is effected equal to. shares of Georgia-Pacific Group
Stock per Purchase Contract (the "Early Settlement Rate"). The Early Settlement
Rate shall be adjusted in the same manner and at the same time as the Settlement
Rate is adjusted as provided in the Purchase Contract Agreement.
Upon registration of transfer of this Treasury PEPS Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Purchase Contract Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Treasury PEPS Units Certificate. The Company covenants and
agrees, and the Holder, by its acceptance hereof, likewise covenants and agrees,
to be bound by the provisions of this paragraph.
The Holder of this Treasury PEPS Units Certificate, by its acceptance
hereof, authorizes the Purchase Contract Agent to enter into and perform the
related Purchase Contracts forming part of the Treasury PEPS Units evidenced
hereby on its behalf as its attorney-in-fact, expressly withholds any consent to
the assumption (i.e., affirmance) of the Purchase Contracts by the Company or
its trustee in the event that the Company becomes the subject of a case under
the Bankruptcy Code, agrees to be bound by the terms and provisions thereof,
covenants and agrees to perform its obligations under such Purchase Contracts,
consents to the provisions of the Purchase Contract Agreement, authorizes the
Purchase Contract Agent to enter into and perform the Purchase Contract
Agreement and the Pledge Agreement on its behalf as its attorney-in-fact, and
consents to the Pledge of the Treasury Securities underlying this Treasury PEPS
Units Certificate pursuant to the Pledge Agreement. The Holder further
covenants and agrees, that, to the extent and in the manner provided in the
Purchase Contract Agreement and the Pledge Agreement, but subject to the terms
thereof, payments in respect to the aggregate principal amount of the Pledged
Treasury Securities on the Purchase Contract Settlement Date shall be paid by
the Collateral Agent to the Company in satisfaction of such Holder's obligations
under such Purchase Contract and such Holder shall acquire no right, title or
interest in such payments.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by, and construed
in accordance with, the laws of the State of New York.
B-9
<PAGE>
The Company, the Purchase Contract Agent and its Affiliates and any agent
of the Company or the Purchase Contract Agent may treat the Person in whose name
this Treasury PEPS Units Certificate is registered as the owner of the Treasury
PEPS Units evidenced hereby for the purpose of receiving payments of interest on
the Treasury Securities, receiving payments of Purchase Contract Payments,
performance of the Purchase Contracts and for all other purposes whatsoever,
whether or not any payments in respect thereof be overdue and notwithstanding
any notice to the contrary, and neither the Company, the Purchase Contract Agent
nor any such agent shall be affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof, entitle
the Holder to any of the rights of a holder of shares of Georgia-Pacific Group
Stock.
A copy of the Purchase Contract Agreement is available for inspection at
the offices of the Purchase Contract Agent.
B-10
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM: as tenants in common
UNIF GIFT MIN ACT: ---------------Custodian---------------
(cust) (minor)
Under Uniform Gifts to Minors Act of _____
__________________________________________
TEN ENT:
as tenants by the entireties
JT TEN: as joint tenants with right of survivorship
and not as tenants in common
Additional abbreviations may also be used though not in the above list.
-------------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Treasury PEPS Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing attorney to transfer said Treasury PEPS
Units Certificates on the books of Georgia-Pacific Corporation with full power
of substitution in the premises.
Dated:
-------------------- ------------------------------------------
Signature
NOTICE: The signature to this assignment
must correspond with the name as it
appears upon the face of the within
Treasury PEPS Units Certificates in every
particular, without alteration or
enlargement or any change whatsoever.
Signature Guarantee:
-----------------------------------
B-11
<PAGE>
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Georgia-
Pacific Group Stock deliverable upon settlement on or after the Purchase
Contract Settlement Date of the Purchase Contracts underlying the number of
Treasury PEPS Units evidenced by this Treasury PEPS Units Certificate be
registered in the name of, and delivered, together with a check in payment for
any fractional share, to the undersigned at the address indicated below unless a
different name and address have been indicated below. If shares are to be
registered in the name of a Person other than the undersigned, the undersigned
will pay any transfer tax payable incident thereto.
Dated: -------------------------------------
-------------- Signature
Signature Guarantee:
-------------------
(if assigned to another person)
If shares are to be registered in
the name of and delivered to a
Person other than the Holder,
please (i) print such Person's name REGISTERED HOLDER
and address and (ii) provide a
guarantee of your signature:
Please print name and address of
Registered Holder
- ------------------------------------- -------------------------------------
Name Name
- ------------------------------------- -------------------------------------
Address Address
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
Social Security or other
Taxpayer Identification -------------------------------------
Number, if any
B-12
<PAGE>
ELECTION TO SETTLE EARLY
The undersigned Holder of this Treasury PEPS Units Certificate irrevocably
exercises the option to effect Early Settlement in accordance with the terms of
the Purchase Contract Agreement with respect to the Purchase Contracts
underlying the number of Treasury PEPS Units evidenced by this Treasury PEPS
Units Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Treasury PEPS with
an aggregate Stated Amount equal to $1,000 or an integral multiple thereof. The
undersigned Holder directs that a certificate for shares of Georgia-Pacific
Group Stock deliverable upon such Early Settlement be registered in the name of,
and delivered, together with a check in payment for any fractional share and any
Treasury PEPS Units Certificate representing any Treasury PEPS Units evidenced
hereby as to which Early Settlement of the related Purchase Contracts is not
effected, to the undersigned at the address indicated below unless a different
name and address have been indicated below. Pledged Treasury Securities
deliverable upon such Early Settlement will be transferred in accordance with
the transfer instructions set forth below. If shares are to be registered in
the name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.
Dated:
----------------- -------------------------------------
Signature
Signature Guarantee:
-------------------------------------
B-13
<PAGE>
Number of Securities evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected:
If shares of Georgia-Pacific Group Stock of
Treasury PEPS Units Certificates are to be REGISTERED HOLDER
registered in the name of and delivered to
and Pledged Treasury Securities are to be
transferred to a Person other than the
Holder, please print such Person's name and
address:
Please print name and address of
Registered Holder:
- ------------------------------- -------------------------------------
Name Name
- ------------------------------- -------------------------------------
Address Address
- ------------------------------- -------------------------------------
- ------------------------------- -------------------------------------
- ------------------------------- -------------------------------------
Social Security or other
Taxpayer Identification
Number, if any -------------------------------------
Transfer Instructions for Pledged Treasury Securities Transferable Upon Early
Settlement or a Termination Event:
B-14
<PAGE>
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have been made:
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------
Amount of Amount of Number of Signature of
decrease in increase in Treasury PEPS authorized
Number of Number of Units evidenced officer of
Date Treasury PEPS Treasury PEPS by this Trustee or
Units evidenced Units evidenced Global Securities
by the by the Certificate Custodian
Global Certificate Global Certificate following such
decrease or
increase
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
EXHIBIT C
INSTRUCTION TO PURCHASE CONTRACT AGENT
The First National Bank of Chicago
One First National Plaza
Suite 0126
Chicago, Illinois 60670-0126
Attention: Global Corporate Services
Re: [_______ PEPS Units] [_______ Treasury PEPS Units] of Georgia-Pacific
Corporation, a Georgia corporation (the "Company")
The undersigned Holder hereby notifies you that it has delivered to The
Chase Manhattan Bank, as Securities Intermediary, for credit to the Collateral
Account, $______ aggregate principal amount of [Senior Deferrable Notes]
[Treasury Securities] in exchange for the [Pledged Senior Deferrable Notes]
[Pledged Treasury Securities] held in the Collateral Account, in accordance with
the Pledge Agreement, dated as of July 7, 1999 (the "Pledge Agreement"; unless
otherwise defined herein, terms defined in the Pledge Agreement are used herein
as defined therein), between you, the Company, the Collateral Agent and the
Securities Intermediary. The undersigned Holder has paid all applicable fees
relating to such exchange. The undersigned Holder hereby instructs you to
instruct the Collateral Agent to release to you on behalf of the undersigned
Holder the [Pledged Senior Deferrable Notes] [Pledged Treasury Securities]
related to such [PEPS Units] [Treasury PEPS Units].
Date:
----------------------- -----------------------------------------
Signature
Signature Guarantee:
---------------------
Please print name and address of Registered Holder:
- ---------------------------------- ------------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
Address
- ---------------------------------
- ---------------------------------
- ---------------------------------
<PAGE>
EXHIBIT D
NOTICE FROM PURCHASE CONTRACT AGENT
TO HOLDERS
(Transfer of Collateral upon Occurrence of a Termination Event)
[HOLDER]
- -----------------------
- -----------------------
Attention:
Telecopy: __________
Re: [__________ PEPS Units] [______ Treasury PEPS
Units] of Georgia-Pacific Corporation, a Georgia
corporation (the "Company")
Please refer to the Purchase Contract Agreement, dated as of July 7, 1999
(the "Purchase Contract Agreement"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and the undersigned, as Purchase Contract Agent and as
attorney-in-fact for the holders of PEPS Units and Treasury PEPS Units from time
to time.
We hereby notify you that a Termination Event has occurred and that [the
Senior Deferrable Notes][the Treasury Securities] underlying your ownership
interest in _____ [PEPS Units] [Treasury PEPS Units] have been released and are
being held by us for your account pending receipt of transfer instructions with
respect to such [Senior Deferrable Notes][Treasury Securities] (the "Released
Securities").
Pursuant to Section 3.15 of the Purchase Contract Agreement, we hereby
request written transfer instructions with respect to the Released Securities.
Upon receipt of your instructions and upon transfer to us of your [PEPS
Units][Treasury PEPS Units] effected through book-entry or by delivery to us of
your [PEPS Units Certificate][Treasury PEPS Units Certificate], we shall
transfer the Released Securities by book-entry transfer or other appropriate
procedures, in accordance with your instructions. In the event you fail to
effect such transfer or delivery, the Released Securities and any distributions
thereon, shall be held in our name, or a nominee in trust for your benefit,
until such time as such [PEPS Units][Treasury PEPS Units] are transferred or
your [PEPS Units Certificate] [Treasury PEPS Units Certificate] is surrendered
or satisfactory evidence is provided that such your [PEPS Units
Certificate][Treasury PEPS Units Certificate] has been destroyed, lost or
stolen, together with any indemnification that we or the Company may require.
Date: By: THE FIRST NATIONAL BANK OF CHICAGO
---------------------------
Name:
D-1
<PAGE>
Title: Authorized Officer
D-2
<PAGE>
EXHIBIT E
NOTICE TO SETTLE BY CASH
The First National Bank of Chicago
One First National Plaza
Suite 0126
Chicago, Illinois 60670-0126
Attention: Global Corporate Services
Re: [_______ PEPS Units] [Treasury PEPS Units]
of Georgia-Pacific Corporation, a Georgia
corporation (the "Company")
The undersigned Holder hereby irrevocably notifies you in accordance with
Section 5.4 of the Purchase Contract Agreement, dated as of July 7, 1999 (the
"Purchase Contract Agreement"; unless otherwise defined herein, terms defined in
the Purchase Contract Agreement are used herein as defined therein), between the
Company and you, as Purchase Contract Agent and as Attorney-in-Fact for the
Holders of the Purchase Contracts, that such Holder has elected to pay to the
Securities Intermediary for deposit in the Collateral Account, prior to or on
11:00 a.m. (New York City time) on the fifth Business Day immediately preceding
the Purchase Contract Settlement Date (in lawful money of the United States by
certified or cashiers' check or wire transfer, in immediately available funds),
$______ as the Purchase Price for the shares of Georgia-Pacific Group Stock
issuable to such Holder by the Company under the related Purchase Contracts on
the Purchase Contract Settlement Date. The undersigned Holder hereby instructs
you to notify promptly the Collateral Agent of the undersigned Holders' election
to make such cash settlement with respect to the Purchase Contracts related to
such Holder's [PEPS Units] [Treasury PEPS Units].
Date:
----------------------- -----------------------------------------
Signature
Signature Guarantee:
---------------------
Please print name and address of Registered Holder:
<PAGE>
EXHIBIT F
NOTICE FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT AND SENIOR TRUSTEE
(Settlement of Purchase Contract through Remarketing)
The Chase Manhattan Bank, as Collateral Agent
450 West 33rd Street
New York, New York 10001
Attention: Corporate Trust Group
Telecopy: 212-946-8159
The Bank of New York, as Senior Trustee
______________________________
______________________________
Attention:
Telecopy:
Re: __________ PEPS Units of Georgia-Pacific Corporation,
a Georgia corporation (the "Company")
Please refer to the Purchase Contract Agreement, dated as of July 7, 1999
(the "Purchase Contract Agreement"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and the undersigned, as Purchase Contract Agent and as
attorney-in-fact for the Holders of PEPS Units from time to time.
In accordance with Section 5.4 of the Purchase Contract Agreement and,
based on instructions and Cash Settlements received from Holders of PEPS Units
as of 11:00 a.m. (New York City time), the fifth Business Day preceding the
Purchase Contract Settlement Date, we hereby notify you that ______ Senior
Deferrable Notes are to be tendered for purchase in the Remarketing.
Date: By: THE FIRST NATIONAL BANK OF CHICAGO
--------------------------------
Name:
Title: Authorized Officer
F-1
<PAGE>
EXHIBIT 4(q)
================================================================================
GEORGIA-PACIFIC CORPORATION
and
THE CHASE MANHATTAN BANK , as Collateral Agent
and
THE CHASE MANHATTAN BANK, as Securities Intermediary
and
THE FIRST NATIONAL BANK OF CHICAGO, as Purchase Contract Agent
PLEDGE AGREEMENT
Dated as of July 7, 1999
================================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
Section 1. Definitions................................................................ 1
Section 2. Pledge..................................................................... 5
2.1 Pledge..................................................................... 5
2.2 Control; Financing Statement............................................... 5
2.3 Termination................................................................ 5
Section 3. Distributions on Pledged Collateral........................................ 5
3.1 Income Distributions....................................................... 5
3.2 Principal Payments Following Termination Event............................. 6
3.3 Principal Payments Prior To or On Purchase Contract Settlement Date........ 6
3.4 Payments to Purchase Contract Agent........................................ 6
3.5 Assets Not Properly Released............................................... 6
Section 4. Control.................................................................... 7
4.1 Establishment of Collateral Account........................................ 7
4.2 Treatment as Financial Assets.............................................. 7
4.3 Sole Control by Collateral Agent........................................... 7
4.4 Securities Intermediary's Location......................................... 7
4.5 No Other Claims............................................................ 8
4.6 Investment and Release..................................................... 8
4.7 Statements and Confirmations............................................... 8
4.8 Tax Allocations............................................................ 8
4.9 No Other Agreements........................................................ 8
4.10 Powers Coupled With An Interest............................................ 8
Section 5. Initial Deposit; Establishment of Treasury PEPS Units and Reestablishment
of PEPS Units................................................................... 8
5.1 Initial Deposit of Senior Deferrable Notes................................. 9
5.2 Establishment of Treasury PEPS Units....................................... 9
5.3 Reestablishment of PEPS Units.............................................. 9
5.4 Termination Event.......................................................... 10
5.5 Cash Settlement............................................................ 11
5.6 Early Settlement........................................................... 12
5.7 Application of Proceeds Settlement......................................... 13
Section 6. Voting Rights.............................................................. 14
</TABLE>
-i-
<PAGE>
<TABLE>
<S> <C>
Section 7. Rights and Remedies........................................................ 14
7.1 Rights and Remedies of the Collateral Agent................................ 14
7.2 Substitutions.............................................................. 15
Section 8. Representations and Warranties; Covenants.................................. 15
8.1 Representations and Warranties............................................. 15
8.2 Covenants.................................................................. 16
Section 9. The Collateral Agent and the Securities Intermediary....................... 16
9.1 Appointment, Powers and Immunities......................................... 16
9.2 Instructions of the Company................................................ 17
9.3 Reliance by Collateral Agent and Securities Intermediary................... 18
9.4 Rights in Other Capacities................................................. 18
9.5 Non-Reliance on Collateral Agent and Securities Intermediary............... 18
9.6 Compensation and Indemnity................................................. 18
9.7 Failure to Act............................................................. 19
9.8 Resignation of Collateral Agent and Securities Intermediary................ 19
9.9 Right to Appoint Agent or Advisor.......................................... 20
9.10 Survival................................................................... 21
9.11 Exculpation................................................................ 21
Section 10. Amendment................................................................. 21
10.1 Amendment Without Consent of Holders...................................... 21
10.2 Amendment With Consent of Holders......................................... 21
10.3 Execution of Amendments................................................... 22
10.4 Effect of Amendments...................................................... 22
10.5 Reference to Amendments................................................... 23
Section 11. Miscellaneous............................................................. 23
11.1 No Waiver................................................................. 23
11.2 Governing Law............................................................. 23
11.3 Notices................................................................... 23
11.4 Successors and Assigns.................................................... 24
11.5 Counterparts.............................................................. 24
11.6 Severability.............................................................. 24
11.7 Expenses, etc............................................................. 24
11.8 Security Interest Absolute................................................ 24
</TABLE>
EXHIBIT A Instruction from Purchase Contract Agent to Collateral Agent
(Establishment of Treasury PEPS Units)
EXHIBIT B Instruction from Collateral Agent to Securities Intermediary
(Establishment of Treasury PEPS Units)
-ii-
<PAGE>
EXHIBIT C Instruction from Purchase Contract Agent to Collateral Agent
(Reestablishment of PEPS Units)
EXHIBIT D Instruction from Collateral Agent to Securities Intermediary
(Reestablishment of PEPS Units)
EXHIBIT E Notice of Cash Settlement from the Securities Intermediary to the
Purchase Contract Agent
-iii-
<PAGE>
PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of July 7, 1999, among Georgia-Pacific
Corporation, a Georgia corporation (the "Company"), The Chase Manhattan Bank, as
collateral agent (in such capacity, together with its successors in such
capacity, the "Collateral Agent"), The Chase Manhattan Bank, as securities
intermediary with respect to the Collateral Account (in such capacity, together
with its successors in such capacity, the "Securities Intermediary"), and The
First National Bank of Chicago, as purchase contract agent and as attorney-in-
fact of the Holders from time to time of the Securities (in such capacity,
together with its successors in such capacity, the "Purchase Contract Agent")
under the Purchase Contract Agreement.
RECITALS
The Company and the Purchase Contract Agent are parties to the Purchase
Contract Agreement dated as of the date hereof (as modified and supplemented and
in effect from time to time, the "Purchase Contract Agreement"), pursuant to
which there may be issued up to 17,250,000 Premium Equity Participating Security
Units--PEPS_ Units (the "Securities").
Each PEPS Unit, at issuance, consists of a unit comprised of (a) a stock
purchase contract (the "Purchase Contract") under which (i) the Holder will
purchase from the Company on the Purchase Contract Settlement Date, for an
amount equal to $50 (the "Stated Amount"), a number of shares of Georgia-Pacific
Corporation--Georgia-Pacific Group Common Stock ("Georgia-Pacific Group Stock")
equal to the Settlement Rate, and (ii) the Company will pay the Holder Purchase
Contract Payments and (b) a senior deferrable note of the Company (a "Senior
Deferrable Note"), having a principal amount equal to the Stated Amount and
maturing on August 16, 2004.
Pursuant to the terms of the Purchase Contract Agreement and the Purchase
Contracts, the Holders of the Securities have irrevocably authorized the
Purchase Contract Agent, as attorney-in-fact of such Holders, among other
things, to execute and deliver this Agreement on behalf of such Holders and to
grant the pledge provided herein of the Collateral Account to secure the
Obligations.
Accordingly, the Company, the Collateral Agent, the Securities Intermediary
and the Purchase Contract Agent, on its own behalf and as attorney-in-fact of
the Holders from time to time of the Securities, agree as follows:
Section 1. Definitions.
-----------
For all purposes of this Agreement, except as otherwise expressly provided
or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them
in this Article and include the plural as well as the singular;
<PAGE>
2
(b) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section, Exhibit or other subdivision;
(c) the following terms which are defined in the UCC shall have the
meanings set forth therein: "certificated security", "control", "financial
asset", "entitlement order", "securities account" and "security entitlement";
(d) the following terms have the meanings assigned to them in the Purchase
Contract Agreement: "Act", "Bankruptcy Code", "Board Resolution", "Business
Day", "Cash Settlement", "Certificate", "Early Settlement", "Early Settlement
Amount", "Early Settlement Date", "Holders", "Indenture", "Opinion of Counsel",
"Outstanding Securities", "PEPS Units", "Person", "Purchase Contract", "Purchase
Contract Payments", "Purchase Contract Settlement Date", "Purchase Price",
"Remarketing Agent", "Remarketing Agreement", "Senior Trustee", "Settlement
Rate", "Termination Event", "Treasury PEPS Units", and "Underwriting Agreement";
(e) the following terms have the meanings given to them in this section
1(e):
"Agreement" means this Pledge Agreement, as the same may be amended,
modified or supplemented from time to time.
"Cash" means any coin or currency of the United States as at the time
shall be legal tender for payment of public and private debts.
"Collateral Account" means the collective reference to:
(1) Securities Account No. . entitled "The Chase Manhattan Bank, as
Collateral Agent, Securities Account (Georgia-Pacific Corporation)"
maintained by the Securities Intermediary for the Purchase Contract Agent
on behalf of and as attorney-in-fact for the Holders;
(2) all investment property and other financial assets from time to
time credited to the Collateral Account, including, without limitation, (A)
Senior Deferrable Notes and security entitlements relating thereto which
are a component of the PEPS Units from time to time, (B) any Treasury
Securities and security entitlements relating thereto delivered from time
to time upon establishment of Treasury PEPS Units in accordance with
Section 5.2 hereof and (C) payments made by Holders pursuant to Section 5.5
hereof (collectively, the "Collateral");
(3) all Proceeds of any of the foregoing (whether such Proceeds arise
before or after the commencement of any proceeding under any applicable
bankruptcy, insolvency or other similar law, by or against the pledgor or
with respect to the pledgor); and
<PAGE>
3
(4) all powers and rights now owned or hereafter acquired under or
with respect to the Collateral Account.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such, and
thereafter "Company" shall mean such successor.
"Obligations" means, with respect to each Holder, the collective
reference to all obligations and liabilities of such Holder under such
Holder's Purchase Contract and this Agreement or any other document made,
delivered or given in connection herewith or therewith, in each case
whether on account of principal, interest (including, without limitation,
interest accruing before and after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to such Holder, whether or not a claim for post-filing
or post-petition interest is allowed in such proceeding), fees,
indemnities, costs, expenses or otherwise (including, without limitation,
all fees and disbursements of counsel to the Company or the Collateral
Agent or the Securities Intermediary that are required to be paid by the
Holder pursuant to the terms of any of the foregoing agreements).
"Permitted Investments" means any one of the following which shall
mature not later than the next succeeding Business Day:
(1) any evidence of indebtedness with an original maturity of 365
days or less issued, or directly and fully guaranteed or insured, by the
United States of America or any agency or instrumentality thereof (provided
that the full faith and credit of the United States of America is pledged
in support of the timely payment thereof or such indebtedness constitutes a
general obligation of it);
(2) deposits, certificates of deposit or acceptances with an original
maturity of 365 days or less of any institution which is a member of the
Federal Reserve System having combined capital and surplus and undivided
profits of not less than $200.0 million at the time of deposit;
(3) investments with an original maturity of 365 days or less of any
Person that is fully and unconditionally guaranteed by a bank referred to
in clause (2);
(4) repurchase agreements and reverse repurchase agreements relating
to marketable direct obligations issued or unconditionally guaranteed by
the United States Government or issued by any agency thereof and backed as
to timely payment by the full faith and credit of the United States
Government;
(5) investments in commercial paper, other than commercial paper
issued by the Company or its affiliates, of any corporation incorporated
under the laws of the
<PAGE>
4
United States or any State thereof, which commercial paper has a rating at
the time of purchase at least equal to "A-1" by Standard & Poor's Ratings
Services ("S&P") or at least equal to "P-1" by Moody's Investors Service,
Inc. ("Moody's"); and
(6) investments in money market funds registered under the Investment
Company Act of 1940, as amended, rated in the highest applicable rating
category by S&P or Moody's.
"Pledge" means the lien and security interest created by this
Agreement.
"Pledged Senior Deferrable Notes" means the Senior Deferrable Notes
and security entitlements with respect thereto from time to time credited
to the Collateral Account and not then released from the Pledge.
"Pledged Treasury Securities" means Treasury Securities and security
entitlements with respect thereto from time to time credited to the
Collateral Account and not then released from the Pledge.
"Proceeds" has the meaning ascribed thereto in the UCC and includes,
without limitation, all interest, dividends, cash, instruments, securities,
financial assets (as defined in (S) 8-102(a)(9) of the UCC) and other
property received, receivable or otherwise distributed upon the sale,
exchange, collection or disposition of any financial assets from time to
time held in the Collateral Account.
"Purchase Contract Agent" has the meaning specified in the paragraph
preceding the recitals of this Agreement.
"TRADES" means the Treasury/Reserve Automated Debt Entry System
maintained by the Federal Reserve Bank of New York pursuant to the TRADES
Regulations.
"TRADES Regulations" means the regulations of the United States
Department of the Treasury, published at 31 C.F.R. Part 357, an amended
from time to time. Unless otherwise defined herein, all terms defined in
the TRADES Regulations are used herein as therein defined.
"Transfer" means:
(1) in the case of certificated securities in registered form,
delivery as provided in (S) 8-301(a) of the UCC, indorsed to the transferee
or in blank by an effective indorsement;
(2) in the case of Treasury Securities, registration of the
transferee as the owner of such Treasury Securities on TRADES; and
<PAGE>
5
(3) in the case of security entitlements, including, without
limitation, security entitlements with respect to Treasury Securities, a
securities intermediary indicating by book entry that such security
entitlement has been credited to the transferee's securities account.
"Treasury Securities" means zero-coupon U.S. Treasury Securities
(Cusip No. 912820BE6) which are the principal strips of the .% U.S.
Treasury Securities which mature on August 15, 2002.
"UCC" means the Uniform Commercial Code as in effect in the State of
New York from time to time.
"Value" means, with respect to any item of Collateral on any date, as
to (1) Cash, the face amount thereof and (2) Treasury Securities or Senior
Deferrable Notes, in each case the aggregate principal amount thereof at
maturity.
Section 2. Pledge.
------
Section 2.1 Pledge.
------
Each Holder, acting through the Purchase Contract Agent as such Holder's
attorney-in-fact, hereby pledges and grants to the Collateral Agent, as agent of
and for the benefit of the Company, a continuing first priority security
interest in and to, and a lien upon and right of set off against, all of such
Holder's right, title and interest in and to the Collateral Account to secure
the prompt and complete payment and performance when due (whether at stated
maturity, by acceleration or otherwise) of the Obligations. The Collateral Agent
shall have all of the rights, remedies and recourses with respect to the
Collateral afforded a secured party by the UCC, in addition to, and not in
limitation of, the other rights, remedies and recourses afforded to the
Collateral Agent by this Agreement.
Section 2.2 Control; Financing Statement.
----------------------------
(a) The Collateral Agent shall have control of the Collateral Account
pursuant to the provisions of Section 4 of this Agreement.
(b) On the date of initial issuance of the Securities, the Purchase
Contract Agent shall deliver to the Collateral Agent a financing statement
prepared by the Company for filing in the Office of the Secretary of State of
the State of New York, signed by the Purchase Contract Agent, as attorney-in-
fact for the Holders, as Debtors, and describing the Collateral.
Section 2.3 Termination.
-----------
<PAGE>
6
As to each Holder, this Agreement and the Pledge created hereby shall
terminate upon the satisfaction of such Holder's Obligations. Upon termination,
the Securities Intermediary shall Transfer the Collateral to the Purchase
Contract Agent for distribution to such Holder in accordance with his interest,
free and clear of any lien, pledge or security interest created hereby.
Section 3. Distributions on Pledged Collateral.
-----------------------------------
Section 3.1 Income Distributions.
--------------------
All income distributions received by the Securities Intermediary on account
of the Senior Deferrable Notes or Permitted Investments from time to time held
in the Collateral Account shall be distributed to the Purchase Contract Agent
for the benefit of the applicable Holders as provided in the Purchase Contracts.
Section 3.2 Principal Payments Following Termination Event.
----------------------------------------------
All payments received by the Securities Intermediary following a
Termination Event of (1) the principal amount of Pledged Senior Deferrable Notes
or (2) the principal amount of the Pledged Treasury Securities, shall be
distributed to the Purchase Contract Agent for the benefit of the applicable
Holders for distribution to such Holders in accordance with their respective
interests.
Section 3.3 Principal Payments Prior To or On Purchase Contract
---------------------------------------------------
Settlement Date.
- ---------------
(a) Subject to the provisions of Section 7.2, and except as provided in
clause 3.3(b) below, if no Termination Event shall have occurred, all payments
received by the Securities Intermediary of (1) the principal amount with respect
to the Pledged Senior Deferrable Notes or (2) the principal amount of Pledged
Treasury Securities, shall be held and invested in Permitted Investments until
the Purchase Contract Settlement Date and on the Purchase Contract Settlement
Date distributed to the Company as provided in Section 5.7 hereof. Any balance
remaining in the Collateral Account shall be distributed to the Purchase
Contract Agent for the benefit of the applicable Holders for distribution to
such Holders in accordance with their respective interests.
(b) All payments received by the Securities Intermediary of (A) the
principal amount of Senior Deferrable Notes or security entitlements thereto or
(1) the principal amount of Treasury Securities or security entitlements
thereto, that, in each case, have been released from the Pledge shall be
distributed to the Purchase Contract Agent for the benefit of the applicable
Holders for distribution to such Holders in accordance with their respective
interests.
Section 3.4 Payments to Purchase Contract Agent.
-----------------------------------
Payments to the Purchase Contract Agent hereunder shall be made to the
account designated by the Purchase Contract Agent for such purpose not later
than 12:00 p.m. (New York
<PAGE>
7
City time) on the Business Day such payment is received by the Securities
Intermediary; provided, however, that if such payment is received on a day that
is not a Business Day or after 12:00 p.m. (New York City time) on a Business
Day, then such payment shall be made no later than 10:30 a.m. (New York City
time) on the next succeeding Business Day.
Section 3.5 Assets Not Properly Released.
----------------------------
If the Purchase Contract Agent or any Holder shall receive any principal
payments on account of financial assets credited to the Collateral Account and
not released therefrom in accordance with this Agreement, the Purchase Contract
Agent or such Holder shall hold the same as trustee of an express trust for the
benefit of the Company and, upon receipt of an Officers' Certificate (as defined
in the Purchase Contract Agreement) of the Company so directing, promptly
deliver the same to the Securities Intermediary for credit to the Collateral
Account or to the Company for application to the obligations of the Holders
under the related Purchase Contracts, and the Purchase Contract Agent and
Holders shall acquire no right, title or interest in any such payments of
principal amounts so received.
Section 4. Control.
-------
Section 4.1 Establishment of Collateral Account.
-----------------------------------
The Securities Intermediary hereby confirms that:
(1) the Securities Intermediary has established the Collateral
Account;
(2) the Collateral Account is a securities account;
(3) subject to the terms of this Agreement, the Securities
Intermediary shall treat the Purchase Contract Agent as entitled to
exercise the rights that comprise any financial asset credited to the
Collateral Account;
(4) all property delivered to the Securities Intermediary pursuant to
this Agreement or the Purchase Contract Agreement will be credited promptly
to the Collateral Account;
(5) all securities or other property underlying any financial assets
credited to the Collateral Account shall be registered in the name of the
Securities Intermediary, indorsed to the Securities Intermediary, or in
blank or credited to another securities account maintained in the name of
the Securities Intermediary, and in no case will any financial asset
credited to the Collateral Account be registered in the name of the
Purchase Contract Agent or any Holder, payable to the order of the Purchase
Contract Agent or any Holder or specially indorsed to the Purchase Contract
Agent or any Holder.
Section 4.2 Treatment as Financial Assets.
-----------------------------
<PAGE>
8
Each item of property (whether investment property, financial asset,
security, instrument or cash) credited to the Collateral Account shall be
treated as a financial asset.
Section 4.3 Sole Control by Collateral Agent.
--------------------------------
Except as provided in Section 6, at all times prior to the termination of
the Pledge, the Collateral Agent shall have sole control of the Collateral
Account, and the Securities Intermediary shall take instructions and directions
with respect to the Collateral Account solely from the Collateral Agent. If at
any time the Securities Intermediary shall receive an entitlement order issued
by the Collateral Agent and relating to the Collateral Account, the Securities
Intermediary shall comply with such entitlement order without further consent by
the Purchase Contract Agent or any Holder or any other Person. Until termination
of the Pledge, the Securities Intermediary will not comply with any entitlement
orders issued by the Purchase Contract Agent or any Holder.
Section 4.4 Securities Intermediary's Location.
----------------------------------
The Collateral Account, and the rights and obligations of the Securities
Intermediary, the Collateral Agent, the Purchase Contract Agent and the Holders
with respect thereto, shall be governed by the laws of the State of New York.
Regardless of any provision in any other agreement, for purposes of the UCC, New
York shall be deemed to be the Securities Intermediary's location.
Section 4.5 No Other Claims.
---------------
Except for the claims and interest of the Collateral Agent and of the
Purchase Contract Agent and the Holders in the Collateral Account, the
Securities Intermediary does not know of any claim to, or interest in, the
Collateral Account or in any financial asset credited thereto. If any person
asserts any lien, encumbrance or adverse claim (including any writ, garnishment,
judgment, warrant of attachment, execution or similar process) against the
Collateral Account or in any financial asset carried therein, the Securities
Intermediary will promptly notify the Collateral Agent and the Purchase Contract
Agent.
Section 4.6 Investment and Release.
----------------------
All proceeds of financial assets from time to time deposited in the
Collateral Account shall be invested and reinvested as provided in this
Agreement. At all times prior to termination of the Pledge, no property shall be
released from the Collateral Account except in accordance with this Agreement or
upon written instructions of the Collateral Agent.
Section 4.7 Statements and Confirmations.
----------------------------
The Securities Intermediary will promptly send copies of all statements,
confirmations and other correspondence concerning the Collateral Account and any
financial assets credited
<PAGE>
9
thereto simultaneously to each of the Purchase Contract Agent and the Collateral
Agent at their addresses for notices under this Agreement.
Section 4.8 Tax Allocations.
---------------
All items of income, gain, expense and loss recognized in the Collateral
Account shall be reported to the Internal Revenue Service and all state and
local taxing authorities under the names and taxpayer identification numbers of
the holders which are the beneficial owners thereof.
Section 4.9 No Other Agreements.
-------------------
The Securities Intermediary has not entered into, and prior to the
termination of the Pledge will not enter into, any agreement with any other
Person relating to the Collateral Account or any financial assets credited
thereto, including, without limitation, any agreement to comply with entitlement
orders of any Person other than the Collateral Agent.
Section 4.10 Powers Coupled With An Interest.
-------------------------------
The rights and powers granted in this Section 4 to the Collateral Agent
have been granted in order to perfect its security interests in the Collateral
Account, are powers coupled with an interest and will be affected neither by the
bankruptcy of the Purchase Contract Agent or any Holder nor by the lapse of
time. The obligations of the Securities Intermediary under this Section 4 shall
continue in effect until the termination of the Pledge.
Section 5. Initial Deposit; Establishment of Treasury PEPS Units and
---------------------------------------------------------
Reestablishment of PEPS Units.
- -----------------------------
Section 5.1 Initial Deposit of Senior Deferrable Notes.
------------------------------------------
Prior to or concurrently with the execution and delivery of this Agreement,
the Purchase Contract Agent, on behalf of the initial Holders of the PEPS Units,
shall Transfer to the Securities Intermediary, for credit to the Collateral
Account, the Senior Deferrable Notes or security entitlements relating thereto,
and the Securities Intermediary shall indicate by book-entry that a securities
entitlement to such Senior Deferrable Notes has been credited to the Collateral
Account.
Section 5.2 Establishment of Treasury PEPS Units.
------------------------------------
(a) At any time prior to or on the seventh Business Day immediately
preceding the Purchase Contract Settlement Date, a Holder of PEPS Units shall
have the right to establish or reestablish Treasury PEPS Units by substitution
of Treasury Securities or security entitlements thereto for the Pledged Senior
Deferrable Notes comprising a part of such Holder's PEPS Units in integral
multiples of 20 PEPS Units by:
<PAGE>
10
(1) transferring to the Securities Intermediary for credit to the
Collateral Account Treasury Securities or security entitlements thereto
having a Value equal to the principal amount of the Pledged Senior
Deferrable Notes to be released, accompanied by a notice, substantially in
the form of Exhibit C to the Purchase Contract Agreement, whereupon the
Purchase Contract Agent shall deliver to the Collateral Agent a notice,
substantially in the form of Exhibit A hereto, (A) stating that such Holder
has Transferred Treasury Securities or security entitlements thereto to the
Securities Intermediary for credit to the Collateral Account, (B) stating
the Value of the Treasury Securities or security entitlements thereto
Transferred by such Holder and (C) requesting that the Collateral Agent
release from the Pledge the Pledged Senior Deferrable Notes that are a
component of such PEPS Units; and
(2) delivering the related PEPS Units to the Purchase Contract Agent.
Upon receipt of such notice and confirmation that Treasury Securities or
security entitlements thereto have been credited to the Collateral Account as
described in such notice, the Collateral Agent shall instruct the Securities
Intermediary by a notice, substantially in the form of Exhibit B hereto, to
release such Pledged Senior Deferrable Notes from the Pledge by Transfer to the
Purchase Contract Agent for distribution to such Holder, free and clear of any
lien, pledge or security interest created hereby.
(b) Upon credit to the Collateral Account of Treasury Securities or
security entitlements thereto delivered by a Holder of PEPS Units and receipt of
the related instruction from the Collateral Agent, the Securities Intermediary
shall release the Pledged Senior Deferrable Notes and shall promptly transfer
the same to the Purchase Contract Agent for distribution to such Holder, free
and clear of any lien, pledge or security interest created hereby.
Section 5.3 Reestablishment of PEPS Units.
-----------------------------
(a) At any time prior to or on the seventh Business Day immediately
preceding the Purchase Contract Settlement Date, a Holder of Treasury PEPS Units
shall have the right to reestablish PEPS Units by substitution of Senior
Deferrable Notes or security entitlements thereto for Pledged Treasury
Securities in integral multiples of 20 Treasury PEPS Units by:
(1) transferring to the Securities Intermediary for credit to the
Collateral Account Senior Deferrable Notes or security entitlements thereto
having a principal amount equal to the Value of the Pledged Treasury
Securities to be released, accompanied by a notice, substantially in the
form of Exhibit C to the Purchase Contract Agreement, whereupon the
Purchase Contract Agent shall deliver to the Collateral Agent a notice,
substantially in the form of Exhibit C hereto, (A) stating that such Holder
has Transferred Senior Deferrable Notes or security entitlements thereto to
the Securities Intermediary for credit to the Collateral Account and (B)
requesting that the Collateral
<PAGE>
11
Agent release from the Pledge the Pledged Treasury Securities related to
such Treasury PEPS Units; and
(2) delivering the related Treasury PEPS Units to the Purchase
Contract Agent.
Upon receipt of such notice and confirmation that Senior Deferrable Notes or
security entitlements thereto have been credited to the Collateral Account as
described in such notice, the Collateral Agent shall instruct the Securities
Intermediary by a notice in the form provided in Exhibit D hereto to release
such Pledged Treasury Securities from the Pledge by Transfer to the Purchase
Contract Agent for distribution to such Holder.
(b) Upon credit to the Collateral Account of Senior Deferrable Notes or
security entitlements thereto, and receipt of the related instruction from the
Collateral Agent, the Securities Intermediary shall release the applicable
Pledged Treasury Securities and shall promptly Transfer the same to the Purchase
Contract Agent for distribution to such Holder, free and clear of any lien,
pledge or security interest created hereby.
Section 5.4 Termination Event.
-----------------
(a) Upon receipt by the Collateral Agent of written notice from the
Company or the Purchase Contract Agent that a Termination Event has occurred,
the Collateral Agent shall release all Collateral from the Pledge and shall
promptly Transfer:
(1) any Pledged Senior Deferrable Notes; and
(2) any Pledged Treasury Securities,
to the Purchase Contract Agent for the benefit of the Holders for distribution
to such Holders in accordance with their respective interests, free and clear of
any lien, pledge or security interest or other interest created hereby.
(b) If such Termination Event shall result from the Company's becoming a
debtor under the Bankruptcy Code, and if the Collateral Agent shall for any
reason fail promptly to effectuate the release and Transfer of all Pledged
Senior Deferrable Notes or the Pledged Treasury Securities, as the case may be,
as provided by this Section 5.4, the Purchase Contract Agent shall:
(1) use its best efforts to obtain an opinion of a nationally
recognized law firm reasonably acceptable to the Collateral Agent to the
effect that, as a result of the Company's being the debtor in such a
bankruptcy case, the Collateral Agent will not be prohibited from releasing
or Transferring the Collateral as provided in this Section 5.4, and shall
deliver such opinion to the Collateral Agent within ten days after the
occurrence of such Termination Event, and if (A) the Purchase Contract
Agent shall be unable to
<PAGE>
12
obtain such opinion within ten days after the occurrence of such
Termination Event or (B) the Collateral Agent shall continue, after
delivery of such opinion, to refuse to effectuate the release and Transfer
of all Pledged Senior Deferrable Notes, all the Pledged Treasury Securities
or the Proceeds of any of the foregoing, as the case may be, as provided in
this Section 5.4, then the Purchase Contract Agent shall within fifteen
days after the occurrence of such Termination Event commence an action or
proceeding in the court having jurisdiction of the Company's case under the
Bankruptcy Code seeking an order requiring the Collateral Agent to
effectuate the release and transfer of all Pledged Senior Deferrable Notes
or all the Pledged Treasury Securities, as the case may be, as provided by
this Section 5.4; or
(2) commence an action or proceeding like that described in clause
5.4(b)(1)(B) hereof within ten days after the occurrence of such
Termination Event.
Section 5.5 Cash Settlement.
---------------
(a) Upon receipt by the Collateral Agent of (1) a notice from the Purchase
Contract Agent promptly after the receipt by the Purchase Contract Agent of a
notice from a Holder of PEPS Units or Treasury PEP Units has elected, in
accordance with the procedures specified in Section 5.4(a)(i) or (d)(i) of the
Purchase Contract Agreement, respectively, to effect a Cash Settlement and (2)
payment by such Holder by deposit in the Collateral Account prior to or on 11:00
a.m. (New York City time) on the fifth Business Day immediately preceding the
Purchase Contract Settlement Date of the Purchase Price in lawful money of the
United States by certified or cashier's check or wire transfer of immediately
available funds payable to or upon the order of the Securities Intermediary,
then the Collateral Agent shall:
(1) instruct the Securities Intermediary promptly to invest any such
Cash in Permitted Investments;
(2) release from the Pledge (i) in the case of a Holder of PEPS
Units, the related Pledged Senior Deferrable Notes or (ii) in the case of a
Holder of Treasury PEPS Units, the related Pledged Treasury Securities with
a principal amount equal to the product of (x) the Stated Amount times (y)
the number of Purchase Contracts as to which such Holder has elected to
effect a Cash Settlement pursuant to this Section 5.5(a); and
(3) instruct the Securities Intermediary to Transfer all such Pledged
Senior Deferrable Notes or Pledged Treasury Securities, as the case may be,
to the Purchase Contract Agent for the benefit of such Holder, in each case
free and clear of the Pledge created hereby, for distribution to such
Holder.
Upon receipt of the proceeds upon the maturity of the Permitted Investments on
the Purchase Contract Settlement Date, the Collateral Agent shall (A) instruct
the Securities Intermediary to pay the portion of such proceeds and deliver any
certified or cashier's checks received, in an aggregate amount equal to the
Purchase Price, to the Company on the Purchase Contract
<PAGE>
13
Settlement Date, and (B) instruct the Securities Intermediary to release any
amounts in respect of the interest earned from such Permitted Investments to the
Purchase Contract Agent for distribution to the such Holder.
(b) If a Holder of PEPS Units notifies the Purchase Contract Agent as
provided in paragraph 5.4(a)(i) of the Purchase Contract Agreement of its
intention to pay the Purchase Price in cash, but fails to make such payment as
required by paragraph 5.4(a)(ii) of the Purchase Contract Agreement, such Holder
shall be deemed to have consented to the disposition of such Holder's Pledged
Senior Deferrable Notes in accordance with paragraph 5.4(a)(iii) of the Purchase
Contract Agreement.
(c) If a Holder of Treasury PEPS Units notifies the Purchase Contract
Agent as provided in paragraph 5.4(d)(i) of the Purchase Contract Agreement of
its intention to pay the Purchase Price in cash, but fails to make such payment
as required by paragraph 5.4(d)(ii) of the Purchase Contract Agreement, such
Holder shall be deemed to have elected to pay the Purchase Price in accordance
with paragraph 5.4(d)(iii) of the Purchase Contract Agreement.
(d) Prior to 3:00 p.m. (New York City time) on the fourth Business Day
immediately preceding the Purchase Contract Settlement Date, the Securities
Intermediary shall deliver to the Purchase Contract Agent a notice,
substantially in the form of Exhibit E hereto, stating (i) the amount of cash
that it has received with respect to the Cash Settlement of PEPS Units and (ii)
the amount of cash that it has received with respect to the Cash Settlement of
Treasury PEPS Units.
Section 5.6 Early Settlement.
----------------
Upon receipt by the Collateral Agent of a notice from the Purchase Contract
Agent that a Holder of Securities has elected to effect Early Settlement of its
obligations under the Purchase Contracts forming a part of such Securities in
accordance with the terms of the Purchase Contracts and Section 5.9 of the
Purchase Contract Agreement (which notice shall set forth the number of such
Purchase Contracts as to which such Holder has elected to effect Early
Settlement), and that the Purchase Contract Agent has received from such Holder,
and paid to the Company as confirmed in writing by the Company, the related
Early Settlement Amounts pursuant to the terms of the Purchase Contracts and the
Purchase Contract Agreement and that all conditions to such Early Settlement
have been satisfied, then the Collateral Agent shall release from the Pledge,
(1) Pledged Senior Deferrable Notes in the case of a Holder of PEPS Units or (2)
Pledged Treasury Securities, in the case of a Holder of Treasury PEPS Units,
with a Value equal to the product of (x) the Stated Amount times (y) the number
of Purchase Contracts as to which such Holder has elected to effect Early
Settlement, and shall instruct the Securities Intermediary to Transfer all such
Pledged Senior Deferrable Notes or Pledged Treasury Securities, as the case may
be, to the Purchase Contract Agent for the benefit of such Holder, in each case
free and clear of the Pledge created hereby, for distribution to such Holder.
Section 5.7 Application of Proceeds Settlement.
----------------------------------
<PAGE>
14
(a) If a Holder of PEPS Units has not elected to make an effective Cash
Settlement by notifying the Purchase Contract Agent in the manner provided for
in Section 5.4(a)(i) in the Purchase Contract Agreement, or has given such
notice but failed to deliver the required cash prior to 11:00 A.M. (New York
City time) on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date, such Holder shall be deemed to have elected to pay for the
shares of Georgia-Pacific Group Stock to be issued under such Purchase Contracts
from the Proceeds of the related Pledged Senior Deferrable Notes. In such event,
the Collateral Agent shall instruct the Securities Intermediary to Transfer the
related Pledged Senior Deferrable Notes to the Remarketing Agent for
remarketing. Upon receiving such Pledged Senior Deferrable Notes, the
Remarketing Agent, pursuant to the terms of the Remarketing Agreement, will use
reasonable efforts to remarket such Pledged Senior Deferrable Notes on such
date. The Remarketing Agent will deposit the entire amount of the Proceeds of
such remarketing in the Collateral Account. On the Purchase Contract Settlement
Date, the Collateral Agent shall instruct the Securities Intermediary to apply a
portion of the Proceeds from such remarketing equal to the aggregate principal
amount of such Pledged Senior Deferrable Notes to satisfy in full such Holder's
obligations to pay the Purchase Price to purchase the shares of Georgia-Pacific
Group Stock under the related Purchase Contracts. The Collateral Agent shall
also instruct the Securities Intermediary to apply a portion of the Proceeds of
such remarketing equal to $.1250 per Pledged Senior Deferrable Note to pay the
Remarketing Agent for its services rendered in connection with the remarketing.
The balance of the Proceeds from such remarketing, if any, shall be transferred
to the Purchase Contract Agent for the benefit of such Holder for distribution
to such Holder.
If the Remarketing Agent advises the Collateral Agent in writing that there
has been a Failed Remarketing, thus resulting in an event of default under the
Purchase Contract Agreement and hereunder, the Collateral Agent, for the benefit
of the Company shall, at the written direction of the Company, dispose of the
Pledged Senior Deferrable Notes in accordance with applicable law and satisfy in
full, from such disposition, such Holder's obligations to pay the Purchase Price
for the shares of Georgia-Pacific Group.
(b) If a Holder of Treasury PEPS Units has not elected to make an
effective Cash Settlement by notifying the Purchase Contract Agent in the manner
provided for in Section 5.4(d)(i) of the Purchase Contract Agreement, or has
given such notice but failed to make such payment in the manner required by
Section 5.4(d)(ii) of the Purchase Contract Agreement, such Holder shall be
deemed to have elected to pay for the shares of Georgia-Pacific Group Stock to
be issued under such Purchase Contracts from the Proceeds of the related Pledged
Treasury Securities. Upon maturity of the Pledged Treasury Securities, the
Securities Intermediary, at the written direction of the Collateral Agent, shall
invest the Cash Proceeds of the maturing Pledged Treasury Securities in
Permitted Investments. Without receiving any instruction from any such Holder,
the Collateral Agent shall apply the Proceeds of the related Pledged Treasury
Securities to the settlement of such Purchase Contracts on the Purchase Contract
Settlement Date. In the event the sum of the Proceeds from the related Pledged
Treasury Securities and the investment earnings from the investment in Permitted
Investments exceeds the aggregate Purchase Price of the Purchase Contracts being
settled thereby, the
<PAGE>
15
Collateral Agent shall instruct the Securities Intermediary to distribute such
excess, when received, to the Purchase Contract Agent for the benefit of such
Holder for distribution to such Holder.
Section 6. Voting Rights.
-------------
The Purchase Contract Agent may exercise, or refrain from exercising, any
and all voting and other consensual rights pertaining to the Pledged Senior
Deferrable Notes or any part thereof for any purpose not inconsistent with the
terms of this Agreement and in accordance with the terms of the Purchase
Contract Agreement; provided, that the Purchase Contract Agent shall not
exercise or shall not refrain from exercising such right, as the case may be,
if, in the judgment of the Purchase Contract Agent, such action would impair or
otherwise have a material adverse effect on the value of all or any of the
Pledged Senior Deferrable Notes; and provided, further, that the Purchase
Contract Agent shall give the Company and the Collateral Agent at least five
days' prior written notice of the manner in which it intends to exercise, or its
reasons for refraining from exercising, any such right. Upon receipt of any
notices and other communications in respect of any Pledged Senior Deferrable
Notes, including notice of any meeting at which holders of the Senior Deferrable
Notes are entitled to vote or solicitation of consents, waivers or proxies of
holders of the Senior Deferrable Notes, the Collateral Agent shall use
reasonable efforts to send promptly to the Purchase Contract Agent such notice
or communication, and as soon as reasonably practicable after receipt of a
written request therefor from the Purchase Contract Agent, execute and deliver
to the Purchase Contract Agent such proxies and other instruments in respect of
such Pledged Senior Deferrable Notes (in form and substance satisfactory to the
Collateral Agent) as are prepared by the Purchase Contract Agent with respect to
the Pledged Senior Deferrable Notes.
Section 7. Rights and Remedies.
-------------------
Section 7.1 Rights and Remedies of the Collateral Agent.
-------------------------------------------
(a) In addition to the rights and remedies specified in Section 5.5 hereof
or otherwise available at law or in equity, after an event of default (as
specified in Section 7.1(b) below) hereunder, the Collateral Agent shall have
all of the rights and remedies with respect to the Collateral of a secured party
under the UCC (whether or not the UCC is in effect in the jurisdiction where the
rights and remedies are asserted) and the TRADES Regulations and such additional
rights and remedies to which a secured party is entitled under the laws in
effect in any jurisdiction where any rights and remedies hereunder may be
asserted. Without limiting the generality of the foregoing, such remedies may
include, to the extent permitted by applicable law, (1) retention of the Pledged
Senior Deferrable Notes in full satisfaction of the Holders' obligations under
the Purchase Contracts or (2) sale of the Pledged Senior Deferrable Notes in one
or more public or private sales.
(b) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, in the event the Collateral Agent is unable
to make payments to the Company
<PAGE>
16
on account of principal payments of any Pledged Treasury Securities as provided
in Section 3 hereof, in satisfaction of the Obligations of the Holder of the
Treasury PEPS Units of which such Pledged Treasury Securities are a part under
the related Purchase Contracts, the inability to make such payments shall
constitute an event of default hereunder and the Collateral Agent shall have and
may exercise, with reference to such Pledged Treasury Securities and such
Obligations of such Holder, any and all of the rights and remedies available to
a secured party under the UCC and the TRADES Regulations after default by a
debtor, and as otherwise granted herein or under any other law.
(c) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, the Collateral Agent is hereby irrevocably
authorized to receive and collect all payments of (i) the principal amount of
the Pledged Senior Deferrable Notes and (ii) the principal amount of the Pledged
Treasury Securities subject, in each case, to the provisions of Section 3
hereof, and as otherwise granted herein.
(d) The Purchase Contract Agent and each Holder of Securities agrees that,
from time to time, upon the written request of the Collateral Agent, the
Purchase Contract Agent or such Holder shall execute and deliver such further
documents and do such other acts and things as the Collateral Agent may
reasonably request in order to maintain the Pledge, and the perfection and
priority thereof, and to confirm the rights of the Collateral Agent hereunder.
The Purchase Contract Agent shall have no liability to any Holder for executing
any documents or taking any such acts requested by the Collateral Agent
hereunder, except for liability for its own negligent acts, its own negligent
failure to act or its own willful misconduct.
Section 7.2 Substitutions.
-------------
Whenever a Holder has the right to substitute Treasury Securities, Senior
Deferrable Notes or security entitlements to either of them for financial assets
held in the Collateral Account, such substitution shall not constitute a
novation of the security interest created hereby.
Section 8. Representations and Warranties; Covenants.
-----------------------------------------
Section 8.1 Representations and Warranties.
------------------------------
Each Holder from time to time, acting through the Purchase Contract Agent
as attorney-in-fact (it being understood that the Purchase Contract Agent shall
not be liable for any representation or warranty made by or on behalf of a
Holder), hereby represents and warrants to the Collateral Agent (with respect to
such Holder's interest in the Collateral), which representations and warranties
shall be deemed repeated on each day a Holder Transfers Collateral that:
(1) such Holder has the power to grant a security interest in and
lien on the Collateral;
<PAGE>
17
(2) such Holder is the sole beneficial owner of the Collateral and,
in the case of Collateral delivered in physical form, is the sole holder of
such Collateral and is the sole beneficial owner of, or has the right to
Transfer, the Collateral it Transfers to the Securities Intermediary for
credit to the Collateral Account, free and clear of any security interest,
lien, encumbrance, call, liability to pay money or other restriction other
than the security interest and lien granted under Section 2 hereof;
(3) upon the Transfer of the Collateral to the Securities
Intermediary for credit to the Collateral Account, the Collateral Agent,
for the benefit of the Company, will have a valid and perfected first
priority security interest therein (assuming that any central clearing
operation or any securities intermediary or other entity not within the
control of the Holder involved in the Transfer of the Collateral, including
the Collateral Agent and the Securities Intermediary, gives the notices and
takes the action required of it hereunder and under applicable law for
perfection of that interest and assuming the establishment and exercise of
control pursuant to Section 4 hereof); and
(4) the execution and performance by the Holder of its obligations
under this Agreement will not result in the creation of any security
interest, lien or other encumbrance on the Collateral other than the
security interest and lien granted under Section 2 hereof or violate any
provision of any existing law or regulation applicable to it or of any
mortgage, charge, pledge, indenture, contract or undertaking to which it is
a party or which is binding on it or any of its assets.
Section 8.2 Covenants.
---------
The Holders from time to time, acting through the Purchase Contract Agent
as their attorney-in-fact (it being understood that the Purchase Contract Agent
shall not be liable for any covenant made by or on behalf of a Holder), hereby
covenant to the Collateral Agent that for so long as the Collateral remains
subject to the Pledge:
(1) neither the Purchase Contract Agent nor such Holders will create
or purport to create or allow to subsist any mortgage, charge, lien, pledge
or any other security interest whatsoever over the Collateral or any part
of it other than pursuant to this Agreement; and
(2) neither the Purchase Contract Agent nor such Holders will sell or
otherwise dispose (or attempt to dispose) of the Collateral or any part of
it except for the beneficial interest therein, subject to the Pledge
hereunder, transferred in connection with the Transfer of the Securities.
<PAGE>
18
Section 9. The Collateral Agent and the Securities Intermediary.
----------------------------------------------------
It is hereby agreed as follows:
Section 9.1 Appointment, Powers and Immunities.
----------------------------------
The Collateral Agent shall act as agent for the Company hereunder with such
powers as are specifically vested in the Collateral Agent by the terms of this
Agreement, together with such other powers as are reasonably incidental thereto.
The Collateral Agent shall:
(1) have no duties or responsibilities except those expressly set
forth in this Agreement and no implied covenants or obligations shall be
inferred from this Agreement against the Collateral Agent, nor shall the
Collateral Agent be bound by the provisions of any agreement by any party
hereto beyond the specific terms hereof;
(2) not be responsible for any recitals contained in this Agreement,
or in any certificate or other document referred to or provided for in, or
received by it under, this Agreement, the Securities or the Purchase
Contract Agreement, or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement (other than as against the
Collateral Agent), the Securities or the Purchase Contract Agreement or any
other document referred to or provided for herein or therein or for any
failure by the Company or any other Person (except the Collateral Agent) to
perform any of its obligations hereunder or thereunder or for the
perfection, priority or, except as expressly required hereby, maintenance
of any security interest created hereunder;
(3) not be required to initiate or conduct any litigation or
collection proceedings hereunder (except pursuant to directions furnished
under Section 9.2 hereof, subject to Section 9.6 hereof);
(4) not be responsible for any action taken or omitted to be taken by
it hereunder or under any other document or instrument referred to or
provided for herein or in connection herewith or therewith, except for its
own negligence or willful misconduct; and
(5) not be required to advise any party as to selling or retaining,
or taking or refraining from taking any action with respect to, any
securities or other property deposited hereunder.
Subject to the foregoing, during the term of this Agreement, the Collateral
Agent shall take all reasonable action in connection with the safekeeping and
preservation of the Collateral hereunder.
No provision of this Agreement shall require the Collateral Agent to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties
<PAGE>
19
hereunder. In no event shall the Collateral Agent be liable for any amount in
excess of the Value of the Collateral. Notwithstanding the foregoing, each of
the Collateral Agent and the Securities Intermediary in its individual capacity
hereby waives any right of setoff, bankers' lien, liens or perfection rights as
securities intermediary or any counterclaim with respect to any of the
Collateral.
Section 9.2 Instructions of the Company.
---------------------------
The Company shall have the right, by one or more instruments in writing
executed and delivered to the Collateral Agent, to direct the time, method and
place of conducting any proceeding for the realization of any right or remedy
available to the Collateral Agent, or of exercising any power conferred on the
Collateral Agent, or to direct the taking or refraining from taking of any
action authorized by this Agreement; provided, however, that (i) such direction
shall not conflict with the provisions of any law or of this Agreement and (ii)
the Collateral Agent shall be adequately indemnified as provided herein. Nothing
contained in this Section 9.2 shall impair the right of the Collateral Agent in
its discretion to take any action or omit to take any action which it deems
proper and which is not inconsistent with such direction.
Section 9.3 Reliance by Collateral Agent and Securities Intermediary.
--------------------------------------------------------
Each of the Securities Intermediary and the Collateral Agent shall be
entitled to rely upon any certification, order, judgment, opinion, notice or
other communication (including, without limitation, any thereof by telephone,
telecopy, telex or facsimile) believed by it to be genuine and correct and to
have been signed or sent by or on behalf of the proper Person or Persons
(without being required to determine the correctness of any fact stated therein)
and upon advice and statements of legal counsel and other experts selected by
the Collateral Agent and the Securities Intermediary. As to any matters not
expressly provided for by this Agreement, the Collateral Agent and the
Securities Intermediary shall in all cases be fully protected in acting, or in
refraining from acting, hereunder in accordance with instructions given by the
Company in accordance with this Agreement.
Section 9.4 Rights in Other Capacities.
--------------------------
The Collateral Agent and the Securities Intermediary and their affiliates
may (without having to account therefor to the Company) accept deposits from,
lend money to, make their investments in and generally engage in any kind of
banking, trust or other business with the Purchase Contract Agent or the
Securities Intermediary, as the case may be, any other Person interested herein
and any Holder of Securities (and any of their respective subsidiaries or
affiliates) as if it were not acting as the Collateral Agent or the Securities
Intermediary, as the case may be, and the Collateral Agent, the Securities
Intermediary and their affiliates may accept fees and other consideration from
the Purchase Contract Agent and any Holder of Securities without having to
account for the same to the Company; provided that each of the Securities
Intermediary and the Collateral Agent covenants and agrees with the Company that
it shall not accept, receive or permit there to be created in favor of itself
and shall take no affirmative action
<PAGE>
20
to permit there to be created in favor of any other Person, any security
interest, lien or other encumbrance of any kind in or upon the Collateral other
than the lien created by the Pledge.
Section 9.5 Non-Reliance on Collateral Agent and Securities Intermediary.
------------------------------------------------------------
Neither the Securities Intermediary nor the Collateral Agent shall be
required to keep itself informed as to the performance or observance by the
Purchase Contract Agent or any Holder of Securities of this Agreement, the
Purchase Contract Agreement, the Securities or any other document referred to or
provided for herein or therein or to inspect the properties or books of the
Purchase Contract Agent or any Holder of Securities. Neither the Collateral
Agent nor the Securities Intermediary shall have any duty or responsibility to
provide the Company with any credit or other information concerning the affairs,
financial condition or business of the Purchase Contract Agent or any Holder of
Securities (or any of their respective affiliates) that may come into the
possession of the Collateral Agent or the Securities Intermediary or any of
their respective affiliates.
Section 9.6 Compensation and Indemnity.
--------------------------
The Company agrees to:
(1) pay the Collateral Agent and the Securities Intermediary from
time to time such compensation as shall be agreed in writing between the
Company and the Collateral Agent or the Securities Intermediary, as the
case may be, for all services rendered by them hereunder; and
(2) indemnify the Collateral Agent and the Securities Intermediary
for, and hold each of them harmless from and against, any loss, liability
or reasonable out-of-pocket expense incurred without negligence, willful
misconduct or bad faith on its part, arising out of or in connection with
the acceptance or administration of its powers and duties under this
Agreement, including the reasonable out-of-pocket costs and expenses
(including reasonable fees and expenses of counsel) of defending itself
against any claim or liability in connection with the exercise or
performance of such powers and duties.
Section 9.7 Failure to Act.
--------------
In the event of any ambiguity in the provisions of this Agreement or any
dispute between or conflicting claims by or among the parties hereto or any
other Person with respect to any funds or property deposited hereunder, the
Collateral Agent and the Securities Intermediary shall be entitled, after prompt
notice to the Company and the Purchase Contract Agent, at its sole option, to
refuse to comply with any and all claims, demands or instructions with respect
to such property or funds so long as such dispute or conflict shall continue,
and the Collateral Agent and the Securities Intermediary shall not be or become
liable in any way to any of the parties hereto
<PAGE>
21
for its failure or refusal to comply with such conflicting claims, demands or
instructions. The Collateral Agent and the Securities Intermediary shall be
entitled to refuse to act until either:
(1) such conflicting or adverse claims or demands shall have been
finally determined by a court of competent jurisdiction or settled by
agreement between the conflicting parties as evidenced in a writing
satisfactory to the Collateral Agent or the Securities Intermediary; or
(2) the Collateral Agent or the Securities Intermediary shall have
received security or an indemnity satisfactory to it sufficient to save it
harmless from and against any and all loss, liability or reasonable out-of-
pocket expense which it may incur by reason of its acting.
The Collateral Agent and the Securities Intermediary may in addition elect to
commence an interpleader action or seek other judicial relief or orders as the
Collateral Agent or the Securities Intermediary may deem necessary.
Notwithstanding anything contained herein to the contrary, neither the
Collateral Agent nor the Securities Intermediary shall be required to take any
action that is in its opinion contrary to law or to the terms of this Agreement,
or which would in its opinion subject it or any of its officers, employees or
directors to liability.
<PAGE>
22
Section 9.8 Resignation of Collateral Agent and Securities Intermediary.
-----------------------------------------------------------
(a) Subject to the appointment and acceptance of a successor Collateral
Agent as provided below:
(1) the Collateral Agent may resign at any time by giving notice
thereof to the Company and the Purchase Contract Agent as attorney-in-fact
for the Holders of Securities;
(2) the Collateral Agent may be removed at any time by the Company;
and
(3) if the Collateral Agent fails to perform any of its material
obligations hereunder in any material respect for a period of not less than
20 days after receiving written notice of such failure by the Purchase
Contract Agent and such failure shall be continuing, the Collateral Agent
may be removed by the Purchase Contract Agent.
The Purchase Contract Agent shall promptly notify the Company of any removal of
the Collateral Agent pursuant to clause (3) of the immediately preceding
sentence. Upon any such resignation or removal, the Company shall have the right
to appoint a successor Collateral Agent. If no successor Collateral Agent shall
have been so appointed and shall have accepted such appointment within 30 days
after the retiring Collateral Agent's giving of notice of resignation or such
removal, then the retiring Collateral Agent may petition any court of competent
jurisdiction for the appointment of a successor Collateral Agent. The Collateral
Agent shall be a bank which has an office in New York City with a combined
capital and surplus of at least $50,000,000 and shall not be the Purchase
Contract Agent or any of its affiliates. Upon the acceptance of any appointment
as Collateral Agent hereunder by a successor Collateral Agent, such successor
Collateral Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Collateral Agent, and the
retiring Collateral Agent shall take all appropriate action to transfer any
money and property held by it hereunder (including the Collateral) to such
successor Collateral Agent. The retiring Collateral Agent shall, upon such
succession, be discharged from its duties and obligations as Collateral Agent
hereunder. After any retiring Collateral Agent's resignation hereunder as
Collateral Agent, the provisions of this Section 9 shall continue in effect for
its benefit in respect of any actions taken or omitted to be taken by it while
it was acting as the Collateral Agent.
(b) Subject to the appointment and acceptance of a successor Securities
Intermediary as provided below:
(1) the Securities Intermediary may resign at any time by giving
notice thereof to the Company and the Purchase Contract Agent as attorney-
in-fact for the Holders of Securities;
(2) the Securities Intermediary may be removed at any time by the
Company; and
<PAGE>
23
(3) if the Securities Intermediary fails to perform any of its
material obligations hereunder in any material respect for a period of not
less than 20 days after receiving written notice of such failure by the
Purchase Contract Agent and such failure shall be continuing, the
Securities Intermediary may be removed by the Purchase Contract Agent.
The Purchase Contract Agent shall promptly notify the Company of any removal of
the Securities Intermediary pursuant to clause (3) of the immediately preceding
sentence. Upon any such resignation or removal, the Company shall have the right
to appoint a successor Securities Intermediary. If no successor Securities
Intermediary shall have been so appointed and shall have accepted such
appointment within 30 days after the retiring Securities Intermediary's giving
of notice of resignation or such removal, then the retiring Securities
Intermediary may petition any court of competent jurisdiction for the
appointment of a successor Securities Intermediary. The Securities Intermediary
shall be a bank which has an office in New York City with a combined capital and
surplus of at least $50,000,000 and shall not be the Purchase Contract Agent or
any of its affiliates. Upon the acceptance of any appointment as Securities
Intermediary hereunder by a successor Securities Intermediary, such successor
Securities Intermediary shall thereupon succeed to and become vested with all
the rights, powers, privileges and duties of the retiring Securities
Intermediary, and the retiring Securities Intermediary shall take all
appropriate action to transfer any money and property held by it hereunder
(including the Collateral) to such successor Securities Intermediary. The
retiring Securities Intermediary shall, upon such succession, be discharged from
its duties and obligations as Securities Intermediary hereunder. After any
retiring Securities Intermediary's resignation hereunder as Securities
Intermediary, the provisions of this Section 9 shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by it while it
was acting as the Securities Intermediary.
Section 9.9 Right to Appoint Agent or Advisor.
---------------------------------
The Collateral Agent shall have the right to appoint agents or advisors in
connection with any of its duties hereunder, and the Collateral Agent shall not
be liable for any action taken or omitted by, or in reliance upon the advice of,
such agents or advisors selected in good faith. The appointment of agents
pursuant to this Section 9.9 shall be subject to prior consent of the Company,
which consent shall not be unreasonably withheld.
Section 9.10 Survival.
--------
The provisions of this Section 9 shall survive termination of this
Agreement and the resignation or removal of the Collateral Agent or the
Securities Intermediary.
<PAGE>
24
Section 9.11 Exculpation.
-----------
Anything contained in this Agreement to the contrary notwithstanding, in no
event shall the Collateral Agent or the Securities Intermediary or their
officers, directors, employees or agents be liable under this Agreement to any
third party for indirect, special, punitive, or consequential loss or damage of
any kind whatsoever, including lost profits, whether or not the likelihood of
such loss or damage was known to the Collateral Agent or the Securities
Intermediary, or any of them, incurred without any act or deed that is found to
be attributable to gross negligence or willful misconduct on the part of the
Collateral Agent or the Securities Intermediary.
Section 10. Amendment.
---------
Section 10.1 Amendment Without Consent of Holders.
------------------------------------
Without the consent of any Holders, the Company, the Collateral Agent, the
Securities Intermediary and the Purchase Contract Agent, at any time and from
time to time, may amend this Agreement, in form satisfactory to the Company, the
Collateral Agent, the Securities Intermediary and the Purchase Contract Agent,
to:
(1) evidence the succession of another Person to the Company, and the
assumption by any such successor of the covenants of the Company;
(2) evidence and provide for the acceptance of appointment hereunder
by a successor Collateral Agent, Securities Intermediary or Purchase
Contract Agent;
(3) add to the covenants of the Company for the benefit of the
Holders, or surrender any right or power herein conferred upon the Company,
provided such covenants or such surrender do not adversely affect the
validity, perfection or priority of the Pledge created hereunder; or
(4) cure any ambiguity (or formal defect), correct or supplement any
provisions herein which may be inconsistent with any other such provisions
herein, or make any other provisions with respect to such matters or
questions arising under this Agreement, provided such action shall not
adversely affect the interests of the Holders.
Section 10.2 Amendment With Consent of Holders.
---------------------------------
With the consent of the Holders of not less than a majority of the Purchase
Contracts at the time outstanding, by Act of such Holders delivered to the
Company, the Purchase Contract Agent, the Securities Intermediary or the
Collateral Agent, as the case may be, the Company, when duly authorized, the
Purchase Contract Agent, the Securities Intermediary and the Collateral Agent
may amend this Agreement for the purpose of modifying in any manner the
provisions of this Agreement or the rights of the Holders in respect of the
Securities; provided,
<PAGE>
25
however, that no such supplemental agreement shall, without the unanimous
consent of the Holders of each Outstanding Security adversely affected thereby:
(1) change the amount or type of Collateral underlying a Security,
impair the right of the Holder of any Security to receive distributions on
the underlying Collateral or otherwise adversely affect the Holder's rights
in or to such Collateral;
(2) otherwise effect any action that would require the consent of the
Holder of each Outstanding Security affected thereby pursuant to the
Purchase Contract Agreement if such action were effected by an agreement
supplemental thereto; or
(3) reduce the percentage of Purchase Contracts the consent of whose
Holders is required for any such amendment;
provided that if any amendment or proposal referred to above would adversely
affect only the PEPS Units or only the Treasury PEPS Units, then only the
affected class of Holders as of the record date for the Holders entitled to vote
thereon will be entitled to vote on such amendment or proposal, and such
amendment or proposal shall not be effective except with the consent of Holders
of not less than a majority of such class; provided, further, that the unanimous
consent of the Holders of each outstanding Purchase Contract of such class
affected thereby shall be required to approve any amendment or proposal
specified in clauses (1) through (3) above.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed amendment, but it shall be
sufficient if such Act shall approve the substance thereof.
Section 10.3 Execution of Amendments.
-----------------------
In executing any amendment permitted by this Section, the Collateral Agent,
the Securities Intermediary and the Purchase Contract Agent shall be entitled to
receive and (subject to Section 7.1 of the Purchase Contract Agreement with
respect to the Purchase Contract Agent) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement and that all conditions precedent, if
any, to the execution and delivery of such amendment have been satisfied.
Section 10.4 Effect of Amendments.
--------------------
Upon the execution of any amendment under this Section, this Agreement
shall be modified in accordance therewith, and such amendment shall form a part
of this Agreement for all purposes; and every Holder of Certificates theretofore
or thereafter authenticated, executed on behalf of the Holders and delivered
under the Purchase Contract Agreement shall be bound thereby.
<PAGE>
26
Section 10.5 Reference to Amendments.
-----------------------
Certificates authenticated, executed on behalf of the Holders and delivered
after the execution of any amendment pursuant to this Section may, and shall if
required by the Collateral Agent or the Purchase Contract Agent, bear a notation
in form approved by the Purchase Contract Agent and the Collateral Agent as to
any matter provided for in such amendment. If the Company shall so determine,
new Security Certificates so modified as to conform, in the opinion of the
Collateral Agent, the Purchase Contract Agent and the Company, to any such
amendment may be prepared and executed by the Company and authenticated,
executed on behalf of the Holders and delivered by the Purchase Contract Agent
in accordance with the Purchase Contract Agreement in exchange for Outstanding
Security Certificates.
Section 11. Miscellaneous.
-------------
Section 11.1 No Waiver.
---------
No failure on the part of the Collateral Agent or any of its agents to
exercise, and no course of dealing with respect to, and no delay in exercising,
any right, power or remedy hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise by the Collateral Agent or any of its
agents of any right, power or remedy hereunder preclude any other or further
exercise thereof or the exercise of any other right, power or remedy. The
remedies herein are cumulative and are not exclusive of any remedies provided by
law.
Section 11.2 Governing Law.
-------------
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK.
The Company, the Collateral Agent, the Securities Intermediary and the
Holders from time to time of the Securities, acting through the Purchase
Contract Agent as their attorney-in-fact, hereby submit to the nonexclusive
jurisdiction of the United States District Court for the Southern District of
New York and of any New York state court sitting in New York City for the
purposes of all legal proceedings arising out of or relating to this Agreement
or the transactions contemplated hereby. The Company, the Collateral Agent, the
Securities Intermediary and the Holders from time to time of the Securities,
acting through the Purchase Contract Agent as their attorney-in-fact,
irrevocably waive, to the fullest extent permitted by applicable law, any
objection which they may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum.
Section 11.3 Notices.
-------
All notices, requests, consents and other communications provided for
herein (including, without limitation, any modifications of, or waivers or
consents under, this Agreement) shall be
<PAGE>
27
given or made in writing (including, without limitation, by telecopy) delivered
to the intended recipient at the "Address for Notices" specified below its name
on the signature pages hereof or, as to any party, at such other address as
shall be designated by such party in a notice to the other parties. Except as
otherwise provided in this Agreement, all such communications shall be deemed to
have been duly given when transmitted by telecopier or personally delivered or,
in the case of a mailed notice, upon receipt, in each case given or addressed as
aforesaid.
Section 11.4 Successors and Assigns.
----------------------
This Agreement shall be binding upon and inure to the benefit of the
respective successors and assigns of the Company, the Collateral Agent, the
Securities Intermediary and the Purchase Contract Agent, and the Holders from
time to time of the Securities, by their acceptance of the same, shall be deemed
to have agreed to be bound by the provisions hereof and to have ratified the
agreements of, and the grant of the Pledge hereunder by, the Purchase Contract
Agent.
Section 11.5 Counterparts.
------------
This Agreement may be executed in any number of counterparts, all of which
taken together shall constitute one and the same instrument, and any of the
parties hereto may execute this Agreement by signing any such counterpart.
Section 11.6 Severability.
------------
If any provision hereof is invalid and unenforceable in any jurisdiction,
then, to the fullest extent permitted by law, (i) the other provisions hereof
shall remain in full force and effect in such jurisdiction and shall be
liberally construed in order to carry out the intentions of the parties hereto
as nearly as may be possible and (ii) the invalidity or unenforceability of any
provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provision in any other jurisdiction.
Section 11.7 Expenses, etc.
--------------
The Company agrees to reimburse the Collateral Agent and the Securities
Intermediary for:
(1) all reasonable out-of-pocket costs and expenses of the Collateral
Agent and the Securities Intermediary (including, without limitation, the
reasonable fees and expenses of counsel to the Collateral Agent and the
Securities Intermediary), in connection with (i) the negotiation,
preparation, execution and delivery or performance of this Agreement and
(ii) any modification, supplement or waiver of any of the terms of this
Agreement;
<PAGE>
28
(2) all reasonable costs and expenses of the Collateral Agent and the
Securities Intermediary (including, without limitation, reasonable fees and
expenses of counsel) in connection with (i) any enforcement or proceedings
resulting or incurred in connection with causing any Holder of Securities
to satisfy its obligations under the Purchase Contracts forming a part of
the Securities and (ii) the enforcement of this Section 11.7; and
(3) all transfer, stamp, documentary or other similar taxes,
assessments or charges levied by any governmental or revenue authority in
respect of this Agreement or any other document referred to herein and all
costs, expenses, taxes, assessments and other charges incurred in
connection with any filing, registration, recording or perfection of any
security interest contemplated hereby.
Section 11.8 Security Interest Absolute.
--------------------------
All rights of the Collateral Agent and security interests hereunder, and
all obligations of the Holders from time to time hereunder, shall be absolute
and unconditional irrespective of:
(1) any lack of validity or enforceability of any provision of the
Purchase Contracts or the Securities or any other agreement or instrument
relating thereto;
(2) any change in the time, manner or place of payment of, or any
other term of, or any increase in the amount of, all or any of the
obligations of Holders of the Securities under the related Purchase
Contracts, or any other amendment or waiver of any term of, or any consent
to any departure from any requirement of, the Purchase Contract Agreement
or any Purchase Contract or any other agreement or instrument relating
thereto; or
(3) any other circumstance which might otherwise constitute a defense
available to, or discharge of, a borrower, a guarantor or a pledgor.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
_________________________________ _________________________________
GEORGIA-PACIFIC CORPORATION THE FIRST NATIONAL BANK OF
CHICAGO, as Purchase Contract Agent
and as attorney-in- fact of the
Holders from time to time of the
Securities
By: By:
Name: John F. McGovern Name:
Title:Executive Vice President-- Title:
Financial and Chief Financial
Officer
Address for Notices: Address for Notices:
133 Peachtree Street, N.E. One First National Plaza
Atlanta, Georgia 30303 Suite 0126
Chicago, Illinois 60670-0126
Attention:
Telecopy: Attention: Global Corporate Trust
Services
Telecopy: (312) 407-1708
_________________________________ _________________________________
THE CHASE MANHATTAN BANK, as THE CHASE MANHATTAN BANK, as
Collateral Agent Securities Intermediary
By: By:
Name: Name:
Title: Title:
Address for Notices: Address for Notices:
450 West 33rd Street 450 West 33rd Street
New York, New York 10001 New York, New York 10001
Attention: Corporate Trust Group Attention: Corporate Trust Group
Telecopy: (212) 946-8159 Telecopy: (212) 946-8159
<PAGE>
EXHIBIT A
INSTRUCTION
FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT
(Establishment of Treasury PEPS Units)
The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001
Attention: Corporate Trust Group
Telecopy: (212) 946-8159
Re: PEPS Units of Georgia-Pacific Corporation (the "Company")
Please refer to the Pledge Agreement, dated as of July 7, 1999 (the "Pledge
Agreement"), among the Company, you, as Collateral Agent, The Chase Manhattan
Bank, as Securities Intermediary, and the undersigned, as Purchase Contract
Agent and as attorney-in-fact for the holders of PEPS Units from time to time.
Capitalized terms used herein but not defined shall have the meaning set forth
in the Pledge Agreement.
We hereby notify you in accordance with Section 5.2 of the Pledge Agreement
that the holder of securities named below (the "Holder") has elected to
substitute $__________ Value of Treasury Securities or security entitlements
thereto in exchange for an equal Value of Pledged Senior Deferrable Notes and
has delivered to the undersigned a notice stating that the Holder has
Transferred such Treasury Securities or security entitlements thereto to the
Securities Intermediary, for credit to the Collateral Account.
We hereby request that you instruct the Securities Intermediary, upon
confirmation that such Treasury Securities or security entitlements thereto have
been credited to the Collateral Account, to release to the undersigned an equal
Value of Pledged Senior Deferrable Notes in accordance with Section 5.2 of the
Pledge Agreement.
The First National Bank of Chicago
Date: By:______________________________
Name:
Title:
<PAGE>
Please print name and address of Holder electing to substitute Treasury
Securities or security entitlements thereto for the Pledged Senior Deferrable
Notes:
_________________________ _______________________________
Name Social Security or other
Taxpayer Identification Number,
if any
_________________________
Address
_________________________
_________________________
<PAGE>
EXHIBIT B
INSTRUCTION
FROM COLLATERAL AGENT
TO SECURITIES INTERMEDIARY
(Establishment of Treasury PEPS Units)
The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001
Attention: Corporate Trust Group
Telecopy: (212) 946-8159
Re: PEPS Units of Georgia-Pacific Corporation (the "Company")
Securities Account No. . entitled "The Chase Manhattan Bank,
as Collateral Agent, Securities Account (Georgia-Pacific
Corporation)" (the "Collateral Account")
Please refer to the Pledge Agreement, dated as of July 7, 1999 (the "Pledge
Agreement"), among the Company, you, as Securities Intermediary, The First
National Bank of Chicago, as Purchase Contract Agent and as attorney-in-fact for
the holders of PEPS Units from time to time, and the undersigned, as Collateral
Agent. Capitalized terms used herein but not defined shall have the meanings set
forth in the Pledge Agreement.
When you have confirmed that $__________ Value of Treasury Securities or
security entitlements thereto has been credited to the Collateral Account by or
for the benefit of _________, as Holder of PEPS Units (the "Holder"), you are
hereby instructed to release from the Collateral Account an equal Value of
Senior Deferrable Notes or security entitlements thereto by Transfer to the
Purchase Contract Agent.
The Chase Manhattan Bank
Dated: By:_____________________________
Name:
Title:
<PAGE>
Please print name and address of Holder:
_________________________ ______________________________
Name Social Security or other
Taxpayer Identification Number,
if any
_________________________
Address
_________________________
_________________________
<PAGE>
EXHIBIT C
INSTRUCTION
FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT
(Reestablishment of PEPS Units )
The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001
Attention: Corporate Trust Group
Telecopy: (212) 946-8159
Re: PEPS Units of Georgia-Pacific Corporation (the "Company")
Please refer to the Pledge Agreement, dated as of July 7, 1999 (the "Pledge
Agreement"), among the Company, you, as Collateral Agent, The Chase Manhattan
Bank, as Securities Intermediary, and the undersigned, as Purchase Contract
Agent and as attorney-in-fact for the holders of PEPS Units from time to time.
Capitalized terms used herein but not defined shall have the meanings set forth
in the Pledge Agreement.
We hereby notify you in accordance with Section 5.3(a) of the Pledge
Agreement that the holder of securities listed below (the "Holder") has elected
to substitute $__________ Value of Senior Deferrable Notes or security
entitlements thereto in exchange for $__________ Value of Pledged Treasury
Securities and has delivered to the undersigned a notice stating that the Holder
has Transferred such Senior Deferrable Notes or security entitlements thereto to
the Securities Intermediary, for credit to the Collateral Account.
We hereby request that you instruct the Securities Intermediary, upon
confirmation that such Senior Deferrable Notes or security entitlements thereto
have been credited to the Collateral Account, to release to the undersigned
$__________ Value of Treasury Securities or security entitlements thereto
related to _____ Treasury PEPS Units of such Holder in accordance with Section
5.3(a) of the Pledge Agreement.
The First National Bank of Chicago
Date: By:_______________________________
Name:
Title:
<PAGE>
Please print name and address of Holder electing to substitute Pledged Senior
Deferrable Notes or security entitlements thereto for Pledged Treasury
Securities:
_____________________________ _______________________________
Name Social Security or other
Taxpayer Identification Number,
if any
_____________________________
Address
_____________________________
_____________________________
<PAGE>
EXHIBIT D
INSTRUCTION
FROM COLLATERAL AGENT
TO SECURITIES INTERMEDIARY
(Reestablishment of PEPS Units)
The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001
Attention: Corporate Trust Group
Telecopy: (212) 946-8159
Re: PEPS Units of Georgia-Pacific Corporation (the "Company")
Securities Account No. . entitled "The Chase Manhattan Bank,
as Collateral Agent, Securities Account (Georgia-Pacific
Corporation)" (the "Collateral Account")
Please refer to the Pledge Agreement, dated as of July 7, 1999 (the "Pledge
Agreement"), among the Company, you, as Securities Intermediary, The First
National Bank of Chicago, as Purchase Contract Agent and as attorney-in-fact for
the holders of PEPS Units from time to time, and the undersigned, as Collateral
Agent. Capitalized terms used herein but not defined shall have the meanings set
forth in the Pledge Agreement.
When you have confirmed that $_________ Value of Senior Deferrable Notes or
security entitlements thereto has been credited to the Collateral Account by or
for the benefit of _________, as Holder of PEPS Units (the "Holder"), you are
hereby instructed to release from the Collateral Account $__________ Value of
Treasury Securities or security entitlements thereto by Transfer to the Purchase
Contract Agent.
The Chase Manhattan Bank
Dated: By:______________________________
Name:
Title:
<PAGE>
Please print name and address of Holder:
___________________________ _______________________________
Name Social Security or other
Taxpayer Identification Number,
if any
___________________________
Address
___________________________
___________________________
<PAGE>
EXHIBIT E
NOTICE OF CASH SETTLEMENT FROM SECURITIES INTERMEDIARY
TO PURCHASE CONTRACT AGENT
(Cash Settlement Amounts)
The First National Bank of Chicago
One First National Plaza
Suite 0126
Chicago, Illinois 60670-0126
Attention: Global Corporate Trust Services
Telecopy: (312) 407-1708
Re: PEPS Units of Georgia-Pacific Corporation (the "Company")
Please refer to the Pledge Agreement, dated as of July 7, 1999 (the "Pledge
Agreement"), among you, the Company, The Chase Manhattan Bank, as Collateral
Agent and the undersigned, as Securities Intermediary. Unless otherwise defined
herein, terms defined in the Pledge Agreement are used herein as defined therein
In accordance with Section 5.5(d) of the Pledge Agreement, we hereby notify
you that as of 11:00 a.m., [on the fifth Business Day immediately preceding the
Purchase Contract Settlement Date], we have received (i) $_____ in immediately
available funds paid in an aggregate amount equal to the Purchase Price to the
Company on the Purchase Contract Settlement Date with respect to __________ PEPS
Units and (ii) $_________ in immediately available funds paid in an aggregate
amount equal to the Purchase Price to the Company on the Purchase Contract
Settlement Date with respect to ______ Treasury PEPS Units.
The Chase Manhattan Bank
Date: By:________________________________
Name:
Title:
<PAGE>
EXHIBIT 4(u)
GEORGIA-PACIFIC CORPORATION
Senior Deferrable Notes
REMARKETING AGREEMENT
July 7, 1999
MORGAN STANLEY & CO. INCORPORATED
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
Morgan Stanley & Co. Incorporated (the "Remarketing Agent") is
undertaking to remarket the .% Senior Deferrable Notes due August 16, 2004 (the
"Senior Deferrable Notes"), issued by Georgia-Pacific Corporation, a Georgia
corporation (the "Company"), pursuant to the Indenture, dated as of March 1,
1983, between the Company and The Chase Manhattan Bank (National Association),
as Trustee, as amended and supplemented by the First Supplemental Indenture to
the Indenture, dated July 27, 1988, among Georgia-Pacific Corporation, The Chase
Manhattan Bank (National Association), as Trustee, and Morgan Guaranty Trust
Company of New York, as Successor Trustee, and by the Agreement of Resignation,
Appointment and Acceptance, dated as of January 31, 1992, by and among Georgia-
Pacific Corporation, Morgan Guaranty Trust Company of New York, as Trustee, and
The Bank of New York, as Successor Trustee, (the "Senior Trustee") (as amended
or supplemented, the "Indenture").
The Remarketing (as defined below) of the Senior Deferrable Notes is
provided for in resolutions duly adopted by the Board relating to the Senior
Deferrable Notes (the "Senior Deferrable Notes Board Resolution").
Section 1. Definitions.
------------
(a) Capitalized terms used and not defined in this Agreement shall
have the meanings set forth in the Purchase Contract Agreement, dated as of July
7, 1999 (the "Purchase Contract Agreement"), between the Company and The First
National Bank of Chicago, as Purchase Contract Agent (the "Purchase Contract
Agent"), or in the Senior Deferrable Notes Board Resolution, as the case may be.
(b) As used in this Agreement, the following terms have the
following meanings:
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2
"Remarketed Senior Deferrable Notes" means the Senior Deferrable
Notes subject to the Remarketing, as identified to the Remarketing Agent by
the Purchase Contract Agent after 11:00 a.m. on the fifth Business Day
immediately preceding the Purchase Contract Settlement Date;
"Remarketing Procedures" means the procedures in connection with the
Remarketing of the Senior Deferrable Notes described in the Senior
Deferrable Notes Board Resolution;
"Remarketing" means the remarketing of the Remarketed Senior
Deferrable Notes pursuant to the Remarketing Procedures; and
"subsidiary" has the meaning set forth in Rule 405 under the
Securities Act.
Section 2. Appointment and Obligations of the Remarketing Agent.
-----------------------------------------------------
(a) The Company hereby appoints Morgan Stanley & Co. Incorporated
as exclusive remarketing agent (the "Remarketing Agent"), and Morgan Stanley &
Co. Incorporated hereby accepts appointment as Remarketing Agent, for the
purpose of (1) Remarketing Remarketed Senior Deferrable Notes on behalf of the
holders thereof and (2) performing such other duties as are assigned to the
Remarketing Agent in the Remarketing Procedures, all in accordance with and
pursuant to the Remarketing Procedures.
(b) The Remarketing Agent agrees to (1) use reasonable efforts to
remarket the Remarketed Senior Deferrable Notes tendered or deemed tendered to
the Remarketing Agent in the Remarketing, (2) notify the Company promptly of the
Reset Rate and (3) carry out such other duties as are assigned to the
Remarketing Agent in the Remarketing Procedures, all in accordance with the
provisions of the Remarketing Procedures.
(c) On the third Business Day immediately preceding the Purchase
Contract Settlement Date (the "Remarketing Date"), the Remarketing Agent shall
use reasonable efforts to remarket, at a price at least equal to 100.25% of the
Stated Amount, the Remarketed Senior Deferrable Notes tendered or deemed
tendered for purchase.
(d) If, as a result of the efforts described in Section 2(b), the
Remarketing Agent determines that it will be able to remarket all Remarketed
Senior Deferrable Notes tendered or deemed tendered for purchase at a price at
least equal to 100.25% of the Stated Amount prior to 4:00 p.m. (New York City
time) on the Remarketing Date without increasing the Coupon Rate, the
Remarketing Agent shall set the Reset Rate at the Coupon Rate. If the
Remarketing Agent determines immediately prior to Remarketing that it will not
be able to remarket all of the Remarketed Senior Deferrable Notes tendered or
deemed tendered for purchase at a price at least equal to 100.25% of the Stated
Amount, the Remarketing Agent shall set the Reset Rate at a rate per annum
(rounded to the nearest one-thousandth of one percent per annum) that the
Remarketing Agent determines to be the lowest rate per annum that will enable it
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3
to remarket all of the Remarketed Senior Deferrable Notes tendered or deemed
tendered for purchase at a price equal to 100.25% of the Stated Amount.
(e) Upon receipt of the proceeds from the Remarketing, the
Remarketing Agent shall:
(1) retain 25 basis points (.25%) of the Stated Amount for the
performance of its services as Remarketing Agent hereunder;
(2) remit to the Collateral Agent all excess proceeds of the
Remarketed Senior Deferrable Notes subject to the Pledge Agreement; and
(3) remit to [the holders] all excess proceeds of the Remarketed
Senior Deferrable Notes not subject to the Pledge Agreement.
(f) If none of the holders of Remarketed Senior Deferrable Notes
elects to have Remarketed Senior Deferrable Notes remarketed in the Remarketing,
the Remarketing Agent shall determine the rate that would have been established
had a Remarketing been held on the Remarketing Date, and such rate shall be the
Reset Rate.
(g) If, by 4:00 p.m. (New York City time) on the Remarketing Date,
the Remarketing Agent is unable to remarket all Remarketed Senior Deferrable
Notes tendered or deemed tendered for purchase, a failed Remarketing ("Failed
Remarketing") shall be deemed to have occurred, and the Remarketing Agent shall
so advise by telephone DTC, the Senior Trustee and the Company. In the event of
a Failed Remarketing, the Reset Rate shall equal the Two-Year Benchmark Treasury
rate plus the Applicable Margin.
(h) Provided that there has not been a Failed Remarketing, by
approximately 4:30 p.m. (New York City time) on the Remarketing Date, the
Remarketing Agent shall advise, by telephone:
(1) DTC, the Senior Trustee and the Company of the Reset Rate
determined in the Remarketing and the number of Remarketed Senior
Deferrable Notes sold in the Remarketing;
(2) each purchaser (or the Clearing Agency Participant thereof)
of Remarketed Senior Deferrable Notes of the Reset Rate and the number of
Remarketed Senior Deferrable Notes such purchaser is to purchase; and
(3) each purchaser to give instructions to the Clearing Agency
Participant to pay the purchase price on the Purchase Contract Settlement
Date in same day funds against delivery of the Remarketed Senior Deferrable
Notes purchased through the facilities of DTC.
<PAGE>
4
Section 3. Representations and Warranties of the Company.
----------------------------------------------
The Company represents and warrants (i) on and as of the date
hereof, (ii) on and as of the date the Prospectus Supplement or other
Remarketing Materials (each as defined in Section 3(a) below) are first
distributed in connection with the Remarketing (the "Commencement Date"), (iii)
on and as of the Remarketing Date, and (iv) on and as of the Purchase Contract
Settlement Date that:
(a) The conditions for use of Form S-3, as set forth in the General
Instructions thereto, have been satisfied.
(b) A registration statement on Form S-3 (File No. 333-80757) and
an amendment or amendments thereto with respect to the initial offering of
the Senior Deferrable Notes has (i) been prepared by the Company in
conformity with the requirements of the Securities Act of 1933, as amended
(the "Securities Act"), and the rules and regulations (the "Rules and
Regulations") of the Securities and Exchange Commission (the "Commission")
thereunder; (ii) been filed with the Commission under the Securities Act,
and (iii) become effective under the Securities Act; a registration
statement on Form S-3, if required to be filed in connection with the
Remarketing also may be prepared by the Company in conformity with the
requirements of the Securities Act and the Rules and Regulations and filed
with the Commission under the Securities Act; and the Indenture has been
qualified under the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"). Copies of such registration statement or registration
statements that have become effective and the amendment or amendments to
such registration statements have been delivered by the Company to you.
As used in this Agreement, "Effective Time" means the date and time
as of which the last of such registration statements that have become
effective or may be filed, or the most recent post-effective amendment
thereto, if any, was declared effective by the Commission; "Effective Date"
means the date of the Effective Time of such last registration statement;
"Preliminary Prospectus" means each prospectus included in such last
registration statement, or amendment thereto, before it became effective
under the Securities Act and any prospectus filed by the Company with your
consent pursuant to Rule 424(a) of the Rules and Regulations; "Registration
Statement" means such last registration statement, as amended at its
Effective Time, including documents incorporated by reference therein at
such time and, if applicable, all information contained in the final
prospectus filed with the Commission pursuant to Rule 424(b) of the Rules
and Regulations, including any information deemed to be part of such
Registration Statement as of the Effective Time pursuant to paragraph (b)
of Rule 430A of the Rules and Regulations; and "Prospectus" means such
final prospectus, as first filed pursuant to Rule 424(b) of the Rules and
Regulations.
Reference made herein to any Preliminary Prospectus, the Prospectus or
any other information furnished by the Company to the Remarketing Agent for
distribution to
<PAGE>
5
investors in connection with the Remarketing (the "Remarketing Materials")
shall be deemed to refer to and include any documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the Securities Act
as of the date of such Preliminary Prospectus or the Prospectus, as the
case may be, or, in the case of Remarketing Materials, referred to as
incorporated by reference therein, and any reference to any amendment or
supplement to any Preliminary Prospectus, the Prospectus or the Remarketing
Materials shall be deemed to refer to and include any document filed under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), after
the date of such Preliminary Prospectus or the Prospectus incorporated by
reference therein pursuant to Item 12 of Form S-3 or, if so incorporated,
the Remarketing Materials, as the case may be; and any reference to any
amendment to the Registration Statement shall be deemed to include any
annual report of the Company filed with the Commission pursuant to Section
13(a) or 15(d) of the Exchange Act after the Effective Time that is
incorporated by reference in the Registration Statement.
(c) The Commission has not issued an order preventing or suspending
the use of the Registration Statement, any Preliminary Prospectus, the
Prospectus or the Remarketing Materials.
(d) The Registration Statement conforms (and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus, when they become effective or are filed with the Commission, as
the case may be, will conform) in all respects to the requirements of the
Securities Act and the Rules and Regulations, and the Registration
Statement, the Prospectus and the Remarketing Materials do not and will
not, as of the Effective Date (as to the Registration Statement and any
amendment thereto), as of the applicable filing date (as to the Prospectus
and any amendment or supplement thereto) and as of the Commencement Date,
Remarketing Date and Purchase Contract Settlement Date (as to any
Remarketing Materials) contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; provided that no representation
and warranty is made as to the statement of eligibility and qualification
on Form T-1 of the Senior Trustee under the Trust Indenture Act, or as to
information contained in or omitted from the Registration Statement, the
Prospectus or the Remarketing Materials in reliance upon and in conformity
with written information furnished to the Company by the Remarketing Agent
specifically for inclusion therein. The Indenture conforms in all material
respects to the requirements of the Trust Indenture Act and the applicable
rules and regulations thereunder.
(e) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may
be, conformed in all material respects to the requirements of the
Securities Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder, and none of such documents
contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not
<PAGE>
6
misleading; and any further documents so filed and incorporated by
reference in the Prospectus, when such documents become effective or are
filed with Commission, as the case may be, will conform in all material
respects to the requirements of the Securities Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder and
will not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading.
(f) Subsequent to the date of the latest consolidated financial
statements included or incorporated by reference in the Prospectus or in
any Remarketing Materials, there has not been any material adverse change
in the financial position or results of operations of the Company and its
subsidiaries taken as a whole, whether or not arising from transactions in
the ordinary course of business, except in each case as set forth in or
contemplated by the Prospectus or any Remarketing Materials.
(g) The execution, delivery and performance of this Agreement by the
Company will not be in contravention of law or of any of the provisions of
the Restated Articles of Incorporation or Bylaws of the Company or of any
subsidiary, or of any indenture, agreement or undertaking to which the
Company or any subsidiary is a party or by which it is bound, or of any
order, rule or regulation applicable to them of any court or of any
governmental body or instrumentality having jurisdiction over them or their
properties.
(h) The certificate delivered pursuant to paragraph (e) of Section 6
hereof and all other documents delivered by the Company or its
representatives in connection with the issuance and sale of the Remarketed
Senior Deferrable Notes were on the dates on which they were delivered, or
will be on the dates on which they are to be delivered, in all material
respects true and complete.
Section 4. Fees.
-----
For the performance of its services as Remarketing Agent hereunder,
the Remarketing Agent shall retain from the proceeds of the Remarketing an
amount equal to 25 basis points (.25%) of the purchase price of the Remarketed
Senior Deferrable Notes.
Section 5. Covenants of the Company.
------------------------
The Company covenants and agrees as follows:
(a) (1) To prepare any registration statement or prospectus, if
required, in connection with the Remarketing, in a form approved by the
Remarketing Agent and to file any such prospectus pursuant to the
Securities Act within the period required by the Rules and Regulations;
<PAGE>
7
(2) to advise the Remarketing Agent, promptly after it
receives notice thereof, of the time when any amendment to the Registration
Statement has been filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed and to furnish the
Remarketing Agent with copies thereof;
(3) to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange
Act subsequent to the date of the Prospectus and for so long as the
delivery of a prospectus is required in connection with the offering or
sale of the Remarketed Senior Deferrable Notes;
(4) to advise the Remarketing Agent, promptly after it
receives notice thereof, of the issuance by the Commission of any stop
order or of any order preventing or suspending the use of the Prospectus,
of the suspension of the qualification of any of the Remarketed Senior
Deferrable Notes for offering or sale in any jurisdiction, of the
initiation or threatening of any proceeding for any such purpose, or of any
request by the Commission for the amending or supplementing of the
Registration Statement or the Prospectus or for additional information,
and, in the event of the issuance of any stop order or of any order
preventing or suspending the use of any Prospectus or suspending any such
qualification, to use promptly its best efforts to obtain its withdrawal.
(b) To furnish promptly to the Remarketing Agent and to counsel to
the Remarketing Agent a signed copy of the Registration Statement as
originally filed with the Commission, and each amendment thereto filed with
the Commission, including all consents and exhibits filed therewith.
(c) To deliver promptly to the Remarketing Agent in New York City
such number of the following documents as the Remarketing Agent shall
request (i) conformed copies of the Registration Statement as originally
filed with the Commission and each amendment thereto (in each case
excluding exhibits other than this Agreement and the Indenture); (ii) the
Prospectus and any amended or supplemented Prospectus; (ii) any document
incorporated by reference in the Prospectus (excluding exhibits thereto);
and (iv) any Remarketing Materials; and, if the delivery of a prospectus is
required at any time in connection with the Remarketing and if at such time
any event shall have occurred as a result of which the Prospectus as then
amended or supplemented would include any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made when such Prospectus is delivered, not misleading, or if for any other
reason it shall be necessary during such same period to amend or supplement
the Prospectus or to file under the Exchange Act any document incorporated
by reference in the Prospectus in order to comply with the Securities Act
or the Exchange Act, to notify the Remarketing Agent and, upon its request,
to file such document and to prepare and furnish without charge to the
Remarketing Agent and to any dealer in securities as many copies as the
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8
Remarketing Agent may from time to time request of an amended or
supplemented Prospectus which will correct such statement or omission or
effect such compliance.
(d) To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the
Prospectus that may, in the judgment of the Company or the Remarketing
Agent, be required by the Securities Act or requested by the Commission.
(e) Prior to filing with the Commission (i) any amendment to the
Registration Statement or supplement to the Prospectus or any document
incorporated by reference in the Prospectus or (ii) any Prospectus pursuant
to Rule 424 of the Rules and Regulations, to furnish a copy thereof to the
Remarketing Agent and counsel to the Remarketing Agent; and not to file any
such amendment or supplement which shall be disapproved by the Remarketing
Agent promptly after reasonable notice.
(f) As soon as practicable, but in any event not later than 15
months, after the Effective Date of the Registration Statement, to make
"generally available to its security holders" an "earnings statement"
(which need not be audited) covering a period of at least twelve months
beginning after the Effective Date which will satisfy the provisions of
Section 11(a) of the Securities Act and the Rules and Regulations
(including, at the option of the Company, Rule 158). The terms "generally
available to its security holders" and "earnings statement" shall have the
meanings set forth in Rule 158 of the Rules and Regulations.
(g) To take such action as the Remarketing Agent may reasonably
request in order to qualify the Remarketed Senior Deferrable Notes for
offer and sale under the securities or "blue sky" laws of such
jurisdictions as the Remarketing Agent may reasonably request; provided
that in no event shall the Company be obligated to qualify to do business
in any jurisdiction where it is not now so qualified or to take any action
which would subject it to service of process in suits, other than those
arising out of the offer or sale of the Remarketed Senior Deferrable Notes,
in any jurisdiction where it is not now so subject.
(h) For a period of five years following the Effective Date of the
Registration Statement or so long as any of the Remarketed Senior
Deferrable Notes shall remain outstanding, whichever is shorter, to supply
to the Remarketing Agent copies of such financial statements and other
periodic and special reports as the Company may from time to time
distribute generally to the holders of any class of its capital stock and
to furnish to the Remarketing Agent a copy of each annual or other report
it shall be required to file with the Commission and such other information
concerning the Company and its subsidiaries as the Remarketing Agent may
reasonably request.
(i) To pay (1) the costs incident to the preparation and printing of
the Registration Statement, Prospectus and any Remarketing Materials and
any amendments
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9
or supplements thereto; (2) the costs of distributing the Registration
Statement, Prospectus and any Remarketing Materials and any amendments or
supplements thereto; (3) the fees and expenses of qualifying the Remarketed
Senior Deferrable Notes under the securities laws of the several
jurisdictions as provided in Section 5(g) and of preparing, printing and
distributing a Blue Sky Memorandum (including related fees and expenses of
counsel to the Remarketing Agent); (4) all other costs and expenses
incident to the performance of the obligations of the Company, hereunder;
and (5) the reasonable fees and expenses of counsel to the Remarketing
Agent in connection with their duties hereunder.
Section 6. Conditions to the Remarketing Agent's Obligations.
--------------------------------------------------
The obligations of the Remarketing Agent hereunder are subject to
the following conditions:
(a) The Prospectus shall have been timely filed with the
Commission; no stop order suspending the effectiveness of the Registration
Statement or any part thereof or suspending the qualification of the
Indenture shall have been issued and no proceeding for that purpose shall
have been initiated or threatened by the Commission; and any request of the
Commission for inclusion of additional information in the Registration
Statement or the Prospectus or otherwise shall have been complied with.
(b) The Remarketing Agent shall not have discovered and disclosed
to the Company prior to or on the Remarketing Date that the Prospectus, the
Registration Statement, or the Remarketing Materials or any amendment or
supplement thereto contains any untrue statement of a fact which, in the
opinion of counsel for the Remarketing Agent, is material or omits to state
any fact which, in the opinion of such counsel, is material and is required
to be stated therein or is necessary to make the statements therein not
misleading.
(c) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus, (i) there shall not have
been any material adverse change in the financial position or results of
operations of the Company and its subsidiaries taken as a whole, whether or
not arising from transactions in the ordinary course of business, in each
case other than as set forth in or contemplated by the Registration
Statement or Prospectus and (ii) the Company and its subsidiaries shall not
have sustained any material loss or interference with their business, taken
as a whole, from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or legislative or
other governmental action, order or decree, if in the judgment of the
Remarketing Agent, any such material adverse change makes it impracticable
or inadvisable to proceed with the Remarketing on the terms and in the
manner contemplated in the Prospectus and in the Remarketing Materials.
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(d) The representations and warranties of the Company contained
herein shall be true and correct in all material respects on and as of the
Remarketing Date, and the Company shall have performed in all material
respects all covenants and agreements herein contained to be performed on
its part at or prior to the Remarketing Date.
(e) The Company shall have furnished to the Remarketing Agent a
certificate, dated the Remarketing Date, of (i) either the Chairman, Chief
Executive Officer and President or the Executive Vice President--Finance
and Chief Financial Officer and (ii) either the Vice President and
Treasurer or the Vice President, Deputy General Counsel and Secretary,
stating that:
(i) no order suspending the effectiveness of the Registration
Statement or prohibiting the sale of the Remarketed Senior Deferrable
Notes is in effect, and no proceedings for such purpose are pending
before or, to the knowledge of such officers, threatened by the
Commission;
(ii) the representations and warranties of the Company in
Section 3 are true and correct in all material respects on and as of
the Remarketing Date and the Company has performed in all material
respects all covenants and agreements contained herein to be performed
on its part at or prior to the Remarketing Date;
(iii) the Registration Statement, as of its Effective Date, and
the Prospectus and the Remarketing Materials, as of their respective
dates, did not contain any untrue statement of a material fact and did
not omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading.
(f) On the Remarketing Date, the Remarketing Agent shall have
received a letter addressed to the Remarketing Agent and dated such date,
in form and substance satisfactory to the Remarketing Agent, of Arthur
Andersen LLP, or such other firm of nationally recognized independent
public accountants satisfactory to the Remarketing Agent, containing
statements and information of the type ordinarily included in accountants'
"comfort letters" with respect to certain financial information contained
in the Prospectus and in the Remarketing Materials.
(g) Counsel to the Company shall have furnished to the Remarketing
Agent its opinion letter or opinion letters, as the case may be, addressed
to the Remarketing Agent and dated the Remarketing Date, in form and
substance satisfactory to the Remarketing Agent, to the effect that:
(i) The Company is a corporation duly incorporated and validly
existing and in good standing under the laws of the State of Georgia
with corporate power to own its properties and conduct its businesses
as described in the Prospectus.
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(ii) The Registration Statement was declared effective under the
Securities Act, as of the date and time specified in such opinion, the
Prospectus was filed with the Commission pursuant to the subparagraph
of Rule 424(b) of the Rules and Regulations specified in such opinion
on the date specified therein and, to the knowledge of such counsel,
no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceeding for that purpose is
pending or threatened by the Commission.
(iii) The Registration Statement, as of its Effective Date, and
the Prospectus, as of its date, and any further amendments or
supplements thereto, as of their respective dates, made by the Company
prior to the Purchase Contract Settlement Date (other than the
financial statements, related schedules and other financial data
contained therein, as to which such counsel need express no opinion)
complied as to form in all material respects with the requirements of
the Securities Act, the Rules and Regulations and the Trust Indenture
Act; and the documents incorporated by reference in the Prospectus and
any further amendment or supplement to any such incorporated document
made by the Company prior to the Purchase Contract Settlement Date
(other than the financial statements, related schedules and other
financial data contained therein, as to which such counsel need
express no opinion), when they became effective or were filed with the
Commission, as the case may be, complied as to form in all material
respects with the requirements of the Securities Act or the Exchange
Act, as applicable, and the rules and regulations of the Commission
thereunder; and the Indenture conforms in all material respects to the
requirements of the Trust Indenture Act and the applicable rules and
regulations thereunder.
(iv) The statements contained in the Prospectus under the
caption "Description of the Senior Deferrable Notes", insofar as it
purports to constitute summaries of certain terms of documents
referred to therein, constitute accurate summaries of the terms of
such documents in all material respects.
(v) The Indenture has been duly authorized, executed and
delivered by the Company and (assuming that the Indenture is the valid
and legally binding obligation of the Senior Trustee) constitutes a
valid and binding agreement of each of the Company enforceable against
it in accordance with its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a
proceeding in equity or at law) and an implied covenant of good faith
and fair dealing.
(vi) This Agreement has been duly authorized, executed and
delivered by the Company.
<PAGE>
12
(vii) The Transactions will not conflict with or constitute a
breach of or default under the Restated Articles of Incorporation or
Bylaws of the Company or any of its subsidiaries, or to such counsel's
knowledge, any indenture, agreement or undertaking material to the
Company and its subsidiaries taken as a whole to which the Company or
any of its subsidiaries is a party or by which it is bound, or any
applicable law, or, to such counsel's knowledge, any administrative
regulation or court decree.
(viii) Except for consents, approvals, authorizations,
registrations or qualifications as may be required under the Exchange
Act and applicable state securities laws, no consent, approval,
authorization or order of, or filing or registration with, any such
court or governmental agency or body is required for the Transactions.
(ix) To such counsel's knowledge, there are no material pending
or threatened legal proceeding or any governmental proceeding
instituted or threatened against the Company of a character required
to be disclosed in the Registration Statement that is not adequately
disclosed in the Prospectus.
In rendering such opinion, such counsel may state that its opinion is
limited to matters governed by the Federal laws of the United States of
America and the laws of the State of Georgia and New York. Such counsel
shall also advise the Remarketing Agent that although such counsel is not
passing upon and assumes no responsibility or liability for the accuracy,
completeness or fairness of the statements contained in the documents
incorporated by reference in the Prospectus or any further amendment or
supplement thereto made by the Company prior to such Remarketing Date,
they have no reason to believe that any of such documents (other than the
financial statements and related schedules therein, as to which such
counsel need express no opinion), when such documents became effective or
were filed with the Commission, as the case may be, contained, in the case
of a registration statement which became effective under the Securities
Act, an untrue statement of a material fact or omitted to state a material
fact required to be stated therein necessary to make the statements therein
not misleading, or, in the case of other documents which were filed under
the Securities Act or the Exchange Act with the Commission, an untrue
statement of a material fact or omitted to state a material fact necessary
in order to make the statements therein, in light of the circumstances
under which they were made when such documents were so filed, not
misleading. Such counsel shall also advise the Remarketing Agent that
although such counsel is not passing upon and, except as set forth in
clause (iv) above, assumes no responsibility or liability for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement, the Prospectus and the Remarketing Materials and any further
amendments and supplements thereto made by the Company prior to such date,
they have no reason to believe that, as of its effective date, the
Registration Statement or any further amendment thereto made by the
Company prior to such date (other than the financial statements and related
schedules therein, as to which such
<PAGE>
13
counsel need express no opinion) contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or that,
as of its date, the Prospectus and the Remarketing Materials or any further
amendment or supplement thereto made by the Company prior to such
Remarketing Date (other than the financial statements and related schedules
therein, as to which such counsel need express no opinion) contained an
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading or that, as of such Remarketing
Date, either the Registration Statement, the Prospectus or the Remarketing
Materials or any further amendment or supplement thereto made by the
Company prior to such Remarketing Date (other than the financial statements
and related schedules therein, as to which such counsel need express no
opinion) contains an untrue statement of a material fact or omits to state
a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; and they do not
know of any amendment to the Registration Statement required to be filed or
of any contracts or other documents of a character required to be filed as
an exhibit to the Registration Statement or required to be incorporated by
reference into the Prospectus or the Remarketing Materials or required to
be described in the Registration Statement, the Prospectus or the
Remarketing Materials which were not filed or incorporated by reference or
described as required.
(h) On or after the execution and delivery of this Agreement, no
downgrading shall have occurred in the rating accorded the Company's debt
securities by any "nationally recognized statistical rating organization",
as that term is defined by the Commission for purposes of Rule 436(g)(2)
under the Securities Act.
Section 7. Indemnification.
---------------
(a) The Company shall indemnify and hold harmless the Remarketing
Agent and each person, if any, who controls the Remarketing Agent within the
meaning of Section 15 of the Securities Act against any and all losses, claims,
damages or liabilities, joint or several (including any investigative, legal and
other expenses incurred in connection with, and any amount paid in settlement
of, any action, suit or proceeding or any claim asserted) to which they, or any
of them, may become subject under the Securities Act, the Exchange Act or other
federal or state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities arise out of or are based
upon any untrue statement or alleged untrue statement of a material fact
contained in (A) any Preliminary Prospectus, the Registration Statement, the
Prospectus or the Remarketing Materials or in any amendment or supplement
thereto, or (B) any blue sky application or other document prepared or executed
by the Company (or based upon any written information furnished by the Company)
specifically for the purpose of qualifying any or all of the Remarketed Senior
Deferrable Notes under the securities laws of any state or other jurisdiction
(any such application, document or information being hereinafter called a "Blue
Sky Application"), or the omission or alleged omission to state in any
Preliminary Prospectus, the Registration Statement, the Prospectus or the
Remarketing Materials or in any
<PAGE>
14
amendment or supplement thereto, or in any Blue Sky Application, any material
fact required to be stated therein or necessary to make the statements therein
not misleading; provided however, that the Company shall not be liable in any
such case to the extent that any such loss, claim, damage or liability arises
out of, or is based upon, any untrue statement or alleged untrue statement or
omission or alleged omission made (1) in any Preliminary Prospectus, the
Registration Statement, the Prospectus or the Remarketing Materials or in any
such amendment or supplement, or in any Blue Sky Application in reliance upon
and in conformity with the written information furnished to the Company by or on
behalf of the Remarketing Agent specifically for inclusion therein and described
in a letter from the Remarketing Agent to the Company; and (2) in that part of
the Registration Statement which constitutes the Statement of Eligibility and
Qualification of the Trustee under the Trust Indenture Act other than any such
untrue statement or omission or alleged untrue statement or omission made
therein in reliance upon and in conformity with information furnished in writing
to the Trustee by or on behalf of the Company for use therein; provided,
further, that as to any Preliminary Prospectus this indemnity agreement shall
not inure to the benefit of the Remarketing Agent or any person controlling the
Remarketing Agent on account of any losses, claims, damages or liabilities
arising from the sale of the Remarketed Senior Deferrable Notes to any person by
the Remarketing Agent if the Remarketing Agent failed to send or give a copy of
the Prospectus, as the same may be amended or supplemented, to that person
within the time required by the Securities Act, and the untrue statement or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact in such Preliminary Prospectus was corrected in the
Prospectus, unless such failure resulted from non-compliance by the Company with
Section 5(c). For purposes of the last proviso to the immediately preceding
sentence, the term "Prospectus" shall not be deemed to include the documents
incorporated therein by reference, and the Remarketing Agent shall not be
obligated to send or give any supplement or amendment to any document
incorporated by reference in any Preliminary Prospectus or the Prospectus to any
person other than a person to whom the Remarketing Agent had delivered such
incorporated document or documents in response to a written request therefor.
(b) The Remarketing Agent shall indemnify and hold harmless the
Company and each person, if any, who controls the Company within the meaning of
Section 15 of the Securities Act, each director of the Company and each officer
of the Company who signs the Registration Statement, to the same extent as the
foregoing indemnity from the Company to the Remarketing Agent, but only insofar
as such losses, claims, damages or liabilities arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained
(A) in any Preliminary Prospectus, the Registration Statement, the Prospectus or
the Remarketing Materials or in any amendment or supplement thereto, or (B) in
any Blue Sky Application, or the omission or alleged omission to state in any
Preliminary Prospectus, the Registration Statement, the Prospectus or the
Remarketing Materials or in any amendment or supplement thereto, or in any Blue
Sky Application, any material fact required to be stated therein or necessary to
make the statements therein not misleading, in reliance upon and in conformity
with the written information furnished to the Company by or on behalf of the
Remarketing Agent specifically for inclusion therein and described in a letter
from the Remarketing Agent to the Company; provided, however, that the
obligation of the Remarketing
<PAGE>
15
Agent hereunder to indemnify the Company hereunder shall be limited to the total
price at which the Remarketed Senior Deferrable Notes were remarketed.
(c) Promptly after receipt by an indemnified party under this
Section 7 of notice of any action, suit or proceeding, the indemnified party
shall, if an action, suit or proceeding in respect of which a claim is to be
made against the indemnifying party under this Section 7, notify the
indemnifying party in writing of such action, suit or proceeding, enclosing a
copy of all papers served; provided however, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to
an indemnified party otherwise than under this Section 7. If any such action,
suit or proceeding shall be brought against an indemnified party, and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel satisfactory to the indemnified party. After
notice from the indemnifying party to the indemnified party of its election to
assume the defense of such action, suit or proceeding, the indemnifying party
shall not be liable to the indemnified party under this Section 7 for any legal
or other expenses subsequently incurred by the indemnified party in connection
with the defense thereof other than reasonable costs of investigation. The
indemnified party shall have the right to employ its counsel in any such action,
but the fees and expenses of such counsel shall be at the expense of such
indemnified party unless (A) the employment of counsel of such indemnified party
has been authorized by the indemnifying party, (B) the indemnified party
reasonably shall have concluded that there may be a conflict of interest between
the indemnifying party and the indemnified party in the conduct of the defense
of such action (in which case the indemnifying party shall not have the right to
direct the defense of such action on behalf of the indemnified party) or (C) the
indemnifying party shall not in fact have employed counsel satisfactory to such
indemnified party to assume the defense of such action. An indemnifying party
shall not be liable for any settlement of any action or claim effected without
its consent.
Section 8. Contribution.
------------
(a) If the indemnification provided for in Section 7 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 7(a) or 7(b) in respect of any loss, claim, damage or liability
referred to therein, then each indemnifying party shall, in lieu of indemnifying
such indemnified party, contribute to the amount paid or payable by such
indemnified party as a result of such loss, claim, damage or liability (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company on the one hand and the Remarketing Agent on the other
hand from the Remarketing or (ii) if the allocation provided by clause (i) above
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company on the one hand and the Remarketing Agent on
the other with respect to the statements or omissions which resulted in such
loss, claim, damage or liability, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Remarketing Agent on the other with respect to such offering shall be
deemed to be in the same proportion as the total principal amount of the
Remarketed
<PAGE>
16
Senior Deferrable Notes less the fee paid to the Remarketing Agent pursuant to
Section 4 of this Agreement, on the one hand, and the total fees received by the
Remarketing Agent pursuant to such Section 4, on the other hand, bear to the
total principal amount of the Remarketed Senior Deferrable Notes. The relative
fault shall be determined by reference to whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the Company on the one hand or the
Remarketing Agent on the other hand, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company and the Remarketing Agent agree that it
would not be just and equitable if contributions pursuant to this Section 8 were
to be determined by pro rata allocation or by any other method of allocation
which does not take into account the equitable considerations referred to
herein. The amount paid or payable by an indemnified party as a result of the
loss, claim, damage or liability referred to above in this Section 8 shall be
deemed to include, for purposes of this Section 8, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such claim. Notwithstanding the provisions of this Section 8,
the Remarketing Agent shall not be required to contribute any amount in excess
of the amount by which the fees received by it under Section 4 exceed the amount
of any damages which the Remarketing Agent has otherwise paid or become liable
to pay by reason of any untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 8, each person, if any, who
controls the Remarketing Agent within the meaning of the Securities Act shall
have the same rights to contribution as the Remarketing Agent, and each person,
if any, who controls the Company within the meaning of the Securities Act, each
officer of the Company who shall have signed the Registration Statement and each
director of the Company shall have the same rights to contribution as the
Company, subject in each case to the provisos in this Section 8. Any party
entitled to contribution will, promptly after receipt of notice of commencement
of any action, suit, or proceeding against such party in respect of which a
claim for contribution may be made against another party or parties under this
Section 8, notify such party or parties from whom contribution may be sought,
but the omission so to notify such party or parties shall not relieve the party
or parties from whom contribution may be sought from any other obligation it or
they may have hereunder or otherwise than under this Section 8. No party shall
be liable for contribution with respect to any action or claim settled without
its consent.
Section 9. Resignation and Removal of the Remarketing Agent.
-------------------------------------------------
The Remarketing Agent may resign and be discharged from its duties
and obligations hereunder, and the Company may remove the Remarketing Agent, by
giving 60 days' prior written notice, in the case of a resignation, to the
Company, DTC and the Senior Trustee and, in the case of a removal, the removed
Remarketing Agent, DTC and the Senior Trustee; provided however, that:
(i) the Company may not remove the Remarketing Agent unless (A) the
Remarketing Agent becomes involved as a debtor in a bankruptcy, insolvency
or similar
<PAGE>
17
proceeding, (B) the Remarketing Agent shall not be among the 15
underwriters with the largest volume underwritten in dollars, on a lead or
co-managed basis, of U.S. domestic debt securities during the twelve-month
period ended as of the last calendar quarter preceding the Remarketing
Date, (C) the Remarketing Agent shall be subject to one or more legal
restrictions preventing the performance of its obligations hereunder, or
(D) the Remarketing Agent shall determine that (I) the Company has not met
its obligation under Section 6(c) or (II) using its reasonable efforts, the
Remarketing Agent would be unable to consummate the Remarketing on the
terms and in the manner contemplated in the Prospectus and the Remarketing
Materials; and
(ii) no such resignation nor any such removal shall become effective
until the Company shall have appointed at least one nationally recognized
broker-dealer as successor Remarketing Agent and such successor Remarketing
Agent shall have entered into a remarketing agreement with the Company, in
which it shall have agreed to conduct the Remarketing in accordance with
the Remarketing Procedures.
In any such case, the Company will use its reasonable efforts to appoint a
successor Remarketing Agent and enter into such a remarketing agreement with
such person as soon as reasonably practicable. The provisions of Sections 4, 7
and 8 shall survive the resignation or removal of any Remarketing Agent pursuant
to this Agreement.
Section 10. Dealing in the Remarketed Senior Deferrable Notes.
--------------------------------------------------
The Remarketing Agent, when acting as a Remarketing Agent or in its
individual or any other capacity, may, to the extent permitted by law, buy,
sell, hold and deal in any of the Remarketed Senior Deferrable Notes. The
Remarketing Agent may exercise any vote or join in any action which any
beneficial owner of Remarketed Senior Deferrable Notes may be entitled to
exercise or take pursuant to the Indenture with like effect as if it did not act
in any capacity hereunder. The Remarketing Agent, in its individual capacity,
either as principal or agent, may also engage in or have an interest in any
financial or other transaction with the Company as freely as if it did not act
in any capacity hereunder.
Section 11. Remarketing Agent's Performance; Duty of Care.
---------------------------------------------
<PAGE>
18
The duties and obligations of the Remarketing Agent shall be
determined solely by the express provisions of this Agreement and the Indenture.
No implied covenants or obligations of or against the Remarketing Agent shall be
read into this Agreement or the Indenture. In the absence of bad faith on the
part of the Remarketing Agent, the Remarketing Agent may conclusively rely upon
any document furnished to it, which purports to conform to the requirements of
this Agreement or the Indenture as to the truth of the statements expressed in
any of such documents. The Remarketing Agent shall be protected in acting upon
any document or communication reasonably believed by it to have been signed,
presented or made by the proper party or parties. The Remarketing Agent, acting
under this Agreement, shall incur no liability to the Company or to any holder
of Remarketed Senior Deferrable Notes in its individual capacity or as
Remarketing Agent for any action or failure to act, on its part in connection
with a Remarketing or otherwise, except if such liability is judicially
determined to have resulted from the gross negligence or willful misconduct on
its part.
Section 12. Termination.
-----------
This Agreement shall terminate as to the Remarketing Agent on the
effective date of the resignation or removal of the Remarketing Agent pursuant
to Section 9. In addition, this Agreement may be terminated (A) by the Company
by notifying the Remarketing Agent at any time before the time when the
Remarketed Senior Deferrable Notes are first generally offered by the
Remarketing Agent to dealers by letter or telegram, or (B) by the Remarketing
Agent by notifying the Company at or prior to 10:00 a.m. (New York City time)
on the Remarketing Date by letter or telegram if,
(a) in the judgement of the Remarketing Agent the sale and
delivery of the Remarketed Senior Deferrable Notes is rendered
impracticable or inadvisable because: (1) additional material governmental
restrictions, not in force and effect on the date hereof, shall have been
imposed upon trading in securities generally or minimum or maximum prices
shall have been generally established on the New York Stock Exchange or on
the American Stock Exchange, or trading in securities generally shall have
been suspended on either such Exchange or a general banking moratorium
shall have been established by Federal or New York authorities; (2) any
event shall have occurred or shall exist which makes untrue or incorrect in
any material respect any statement or information contained in the
Registration Statement or Prospectus or which is not reflected in the
Registration Statement or Prospectus but should be reflected therein in
order to make the statements or information contained therein not
misleading in any material respect, and such untrue or incorrect statement
or information is not corrected in an amendment or supplement to the
Registration Statement or Prospectus, or
<PAGE>
19
(b) prior to that time, any of the events described in Sections 6(c)
or (h) shall have occurred.
If this Agreement is terminated pursuant to any of the provisions
hereof, except as otherwise provided herein, the Company shall not be under any
liability to the Remarketing Agent and the Remarketing Agent shall not be under
any liability to the Company, except that (a) if this Agreement is terminated by
the Remarketing Agent because of any failure or refusal on the part of the
Company to comply with the terms or to fulfill any of the conditions of this
Agreement, the Company will reimburse the Remarketing Agent for all of its out-
of-pocket expenses (including the fees and disbursements of its counsel)
reasonably incurred by it, and (b) if the Remarketing Agent failed or refused to
purchase the Remarketed Senior Deferrable Notes hereunder, without some reason
sufficient hereunder to justify the cancellation or termination of its
obligations hereunder, the Remarketing Agent shall not be relieved of liability
to the Company for damages occasioned by its default.
Section 13. Notices.
-------
All statements, requests, notices and agreements hereunder shall
be in writing, and:
(a) if to the Remarketing Agent, shall be delivered or sent by
mail, telex or facsimile transmission to Morgan Stanley & Co. Incorporated,
1585 Broadway, New York, New York 10036, Attention:.;
(b) if to the Company, shall be delivered or sent by mail, telex
or facsimile transmission to 133 Peachtree Street, N.E., Atlanta, Georgia
30303, Attention: Treasurer. (Fax: _____________).
Any such statements, requests, notices or agreements shall take effect at the
time of receipt thereof.
Section 14. Persons Entitled to Benefit of Agreement.
-----------------------------------------
This Agreement shall inure to the benefit of and be binding upon
the Remarketing Agent, the Company, and their respective successors. This
Agreement and the terms and provisions hereof are for the sole benefit of only
those persons, except that (x) the representations, warranties, indemnities and
agreements of the Company contained in this Agreement shall also be deemed to be
for the benefit of the Remarketing Agent and the person or persons, if any, who
control the Remarketing Agent within the meaning of Section 15 of the Securities
Act and (y) the indemnity agreement of the Remarketing Agent contained in
Section 7(b) of this Agreement shall be deemed to be for the benefit of the
Company's directors and officers who sign the Registration Statement and any
person controlling the Company within the meaning of Section 15 of the
Securities Act. Nothing contained in this Agreement is intended or shall be
construed to give any person, other than the persons referred to herein, any
<PAGE>
20
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision contained herein.
Section 15. Survival.
---------
The respective indemnities, representations, warranties and
agreements of the Company and the Remarketing Agent contained in this Agreement
or made by or on behalf of them, respectively, pursuant to this Agreement, shall
survive the Remarketing and shall remain in full force and effect, regardless of
any investigation made by or on behalf of any of them or any person controlling
any of them.
Section 16. Governing Law.
-------------
This Agreement shall be governed by, and construed in accordance
with, the laws of New York.
Section 17. Counterparts.
-------------
This Agreement may be executed in one or more counterparts and, if
executed in more than one counterpart, the executed counterparts shall each be
deemed to be an original but all such counterparts shall together constitute one
and the same instrument.
Section 18. Headings.
--------
The headings herein are inserted for convenience of reference only
and are not intended to be part of, or to affect the meaning or interpretation
of, this Agreement.
<PAGE>
21
If the foregoing correctly sets forth the agreement between the
Company and the Remarketing Agent, please indicate your acceptance in the space
provided for that purpose below.
Very truly yours,
GEORGIA-PACIFIC CORPORATION
By: _________________________
Title:
Accepted:
MORGAN STANLEY & CO. INCORPORATED
By: ______________________________
Authorized Representative
<PAGE>
EXHIBIT 4(w)
[Draft: (New York) June 28 1999]
================================================================================
CREDIT AGREEMENT
among
GEORGIA-PACIFIC CORPORATION,
THE LENDERS NAMED HEREIN,
and
MORGAN STANLEY SENIOR FUNDING, INC.,
as Agent
and
as Lead Arranger and Book Manager
$1,000,000,000
Dated as of June 30, 1999
================================================================================
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
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<S> <C>
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS................................ 1
1.01 Certain Defined Terms................................................ 1
1.02 Computation of Time Periods.......................................... 13
1.03 Accounting Matters................................................... 13
1.04 Certain Terms........................................................ 13
ARTICLE II AMOUNTS AND TERMS OF THE LOANS................................. 13
2.01 Loans................................................................ 13
2.02 Procedure for Borrowings............................................. 13
2.03 Evidence of Indebtedness............................................. 14
2.04 Optional Reduction of the Commitments................................ 15
2.05 Mandatory Reduction of the Commitments............................... 15
2.06 Repayment and Commitment Reductions.................................. 15
2.07 Optional Prepayments................................................. 16
2.08 Interest............................................................. 16
2.09 Default Interest..................................................... 17
2.10 Continuation and Conversion Elections for Loans...................... 17
ARTICLE III FEES; PAYMENTS; TAXES......................................... 18
3.01 Fees................................................................. 18
3.02 Computation of Interest, Fees........................................ 19
3.03 Payments by the Company.............................................. 19
3.04 Payments by the Lenders.............................................. 20
3.05 Taxes................................................................ 21
3.06 Sharing of Payments, Etc............................................. 24
ARTICLE IV CHANGES IN CIRCUMSTANCES; ETC.................................. 25
4.01 Eurodollar Rate Protection........................................... 25
4.02 Additional Interest on Eurodollar Loans.............................. 25
4.03 Increased Costs...................................................... 25
4.04 Illegality........................................................... 26
4.05 Capital Adequacy..................................................... 26
4.06 Funding Losses....................................................... 26
4.07 Funding; Certificates of Lenders..................................... 27
4.08 Change of Lending Office; Limitation on Increased Costs.............. 27
4.09 Replacement of Lenders............................................... 27
ARTICLE V REPRESENTATIONS AND WARRANTIES.................................. 28
</TABLE>
(i)
<PAGE>
<TABLE>
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<S> <C>
5.01 Corporate Existence; Compliance with Law............................. 28
5.02 Corporate Power; Authorization....................................... 28
5.03 Enforceable Obligations.............................................. 29
5.04 Taxes................................................................ 29
5.05 Financial Matters.................................................... 29
5.06 Litigation........................................................... 30
5.07 Subsidiaries......................................................... 30
5.08 Liens................................................................ 31
5.09 No Burdensome Restrictions; No Defaults.............................. 31
5.10 Investment Company Act; Public Utility Holding Company Act........... 31
5.11 Margin Regulations................................................... 31
5.12 Environmental Matters................................................ 31
5.13 Labor Matters........................................................ 33
5.14 ERISA Plans.......................................................... 33
5.15 Transaction.......................................................... 33
ARTICLE VI CONDITIONS PRECEDENT........................................... 33
6.01 Conditions Precedent to the Closing Date............................. 33
6.02 Conditions Precedent to Each Borrowing............................... 35
ARTICLE VII AFFIRMATIVE COVENANTS......................................... 35
7.01 Application of Proceeds.............................................. 35
7.02 Compliance with Laws, Etc............................................ 36
7.03 Payment of Taxes, Etc................................................ 36
7.04 Maintenance of Insurance............................................. 36
7.05 Preservation of Corporate Existence, Etc............................. 36
7.06 Access............................................................... 36
7.07 Keeping of Books..................................................... 36
7.08 Maintenance of Properties, Etc....................................... 36
7.09 Financial Statements................................................. 37
7.10 Reporting Requirements............................................... 37
7.11 ERISA Plans.......................................................... 38
7.12 Environmental Compliance; Notice..................................... 38
7.13 The Merger........................................................... 38
ARTICLE VIII NEGATIVE COVENANTS........................................... 38
8.01 Liens, Etc........................................................... 38
8.02 Sale-Leaseback Transactions.......................................... 41
8.03 Mergers, Etc......................................................... 41
8.04 Transactions with Affiliates......................................... 42
8.05 Accounting Changes................................................... 42
8.06 Margin Regulations................................................... 42
8.07 Negative Pledges, Etc................................................ 42
8.08 Leverage Ratio....................................................... 42
</TABLE>
(ii)
<PAGE>
<TABLE>
<CAPTION>
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<S> <C>
ARTICLE IX EVENTS OF DEFAULT............................................... 42
9.01 Events of Default.................................................... 42
9.02 Remedies............................................................. 45
ARTICLE X THE AGENT....................................................... 45
10.01 Appointment......................................................... 45
10.02 Delegation of Duties................................................ 45
10.03 Liability of Agent.................................................. 45
10.04 Reliance by Agent................................................... 46
10.05 Notice of Default................................................... 46
10.06 Credit Decision..................................................... 47
10.07 Indemnification..................................................... 47
10.08 Agent in Individual Capacity........................................ 47
10.09 Successor Agent..................................................... 48
10.10 The Arranger........................................................ 48
ARTICLE XI MISCELLANEOUS.................................................. 48
11.01 Notices, Etc........................................................ 48
11.02 Amendments, Etc..................................................... 48
11.03 No Waiver; Remedies................................................. 49
11.04 Costs and Expenses.................................................. 49
11.05 Indemnity........................................................... 50
11.06 Right of Set-off.................................................... 51
11.07 Binding Effect...................................................... 51
11.08 Assignments, Participations, Etc.................................... 51
11.09 Confidentiality..................................................... 53
11.10 Survival............................................................ 53
11.11 Severability........................................................ 53
11.12 Headings............................................................ 54
11.13 GOVERNING LAW....................................................... 54
11.14 Execution in Counterparts........................................... 54
11.15 ENTIRE AGREEMENT.................................................... 54
11.16 WAIVER OF JURY TRIAL................................................ 54
</TABLE>
SCHEDULES
Schedule Description
1.01(a) Commitments
1.01(b) Lending Offices
5.02(d) Corporate Power; Authorizations
5.07 Subsidiaries
(iii)
<PAGE>
5.12 Environmental Matters
5.13 Labor Matters
5.14 ERISA
8.01 Existing Liens
EXHIBITS
Exhibit Description
2.02 Form of Notice of Borrowing
2.03(b) Form of Promissory Note
2.10 Form of Notice of Conversion/Continuation
6.01(d) Form of Subsidiary Guaranty
6.01(e) Form of Opinion of Counsel for the Company
6.02(i) Form of Officer's Closing Certificate
7.09 Form of Compliance Certificate
11.08 Form of Notice of Assignment
(iv)
<PAGE>
CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of June 30, 1999 among
GEORGIA-PACIFIC CORPORATION, a Georgia corporation (the "Company"), the various
-------
financial institutions that are, or may from time to time become, party hereto
(the "Lenders"), and MORGAN STANLEY SENIOR FUNDING, INC., as Agent for the
-------
Lenders and as Lead Arranger and Book Manager.
WHEREAS, the Company has obtained commitments from the Lenders,
pursuant to which the Lenders are willing to make loans to the Company in an
aggregate principal amount not to exceed $1,000,000,000, on the terms and
subject to the conditions set forth herein;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
--------------------------------
1.01 Certain Defined Terms. As used in this Agreement and in any
---------------------
Schedules and Exhibits to this Agreement, the following terms have the following
meanings (such meanings to be equally applicable to both the singular and plural
forms of the terms defined):
"Acquisition" means, collectively, the Tender Offer and the Merger.
-----------
"Acquisition Documents" means the Tender Offer Documents and the
---------------------
Merger Documents.
"Adjusted Reference Rate" means the fluctuating interest rate per
-----------------------
annum equal to the higher of (a) the sum of the Federal Funds Rate plus 1/2% and
----
(b) the rate of interest (the "Reference Rate") publicly announced from time to
--------------
time by Citibank, N.A. in New York, New York, as its reference or prime lending
rate. Any change in the Reference Rate shall take effect at the opening of
business on the day specified in the public announcement of such change.
"Affiliate" means, with respect to any Person, any Subsidiary of such
---------
Person and any other Person which, directly or indirectly, controls, or is
controlled by, or is under common control with, such Person (excluding any
trustee under, or any committee with responsibility for administering, any
Plan). A Person shall be deemed to control another Person if such Person
possesses, directly or indirectly, the power:
(a) to vote 10% or more of the securities having ordinary voting power
for the election of directors of such other Person; or
(b) to direct or cause the direction of the management and policies of
such other Person, whether through the ownership of voting securities, by
contract or otherwise.
"Agent" means MSSF, in its capacity as agent for the Lenders, together
-----
with any successor thereto in such capacity.
<PAGE>
"Agreement" means this Credit Agreement, as from time to time amended,
---------
modified or supplemented.
"Aggregate Commitments" means the aggregate amount of the Commitments
---------------------
of all the Lenders as in effect from time to time.
"Aggregate Total Amount" means, for any day, the sum of (I) the
----------------------
aggregate principal amount of all of the Loans outstanding on such day plus (II)
the Aggregate Commitments as in effect on such day.
"Arranger" means MSSF, in its capacity as Arranger hereof.
--------
"Assignee" means any Person which becomes a party to this Agreement as
--------
a Lender hereunder pursuant to Section 11.08.
-------------
"Asset Sale" means any Disposition of property or assets or series of
----------
related Dispositions of property or assets by the Company or any of its
Subsidiaries, except for Excluded Asset Sales.
"Atlanta Acquisition" means Atlanta Acquisition Corp., a Delaware
-------------------
corporation and a wholly-owned Subsidiary of the Company.
"Borrowing" means an extension of credit hereunder consisting of Loans
---------
of the same type made on the same day by the Lenders ratably according to their
respective Commitment Percentages and, in the case of Eurodollar Loans, having
the same Interest Periods.
"Borrowing Dates" means up to four Business Days on or after the
---------------
Closing Date on which a Borrowing of Loans may be incurred hereunder; provided
--------
that each such Borrowing shall occur on or before October 15, 1999.
"Business Day" means any day other than a Saturday, Sunday or other
------------
day on which commercial banks in New York City, New York are authorized or
required by law to close and, if the applicable Business Day relates to any
Eurodollar Loan, means such a day on which dealings are carried on in the London
interbank market.
"Capital Markets Transaction" means (a) the issuance or sale in a
---------------------------
registered public offering, Rule 144A/Regulation S transaction or private
placement of Capital Stock (including equity-linked securities) or notes,
debentures, instruments or other debt securities with a maturity in excess of
one year or (b) the incurrence of loans with a maturity in excess of one year.
Notwithstanding the foregoing, a Capital Markets Transaction shall not include
(i) the incurrence of loans by the Company under its existing senior bank credit
facility agented by Bank of America National Trust and Savings Association (or
any replacement or successor facility) up to an aggregate principal amount of
$2,000,000,000, (ii) the sale of accounts receivable by the Company under its
existing $750,000,000 receivables purchase program or (iii) any purchase money
Indebtedness, construction financing, capital lease or working capital loans
incurred under existing lines of credit.
-2-
<PAGE>
"Capital Stock" means any and all shares, interests, participations or
-------------
other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person (other than a corporation)
and any and all warrants, rights or options to purchase any of the foregoing.
The term "Capital Stock" in any event shall include all PEPS.
--------------
"CERCLA" means the Comprehensive Environmental Response Compensation
------
and Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response Compensation
-------
Liability Information System List.
"Closing Date" means the date on which all the conditions precedent
------------
set forth in Section 6.01 shall have been satisfied or waived.
------------
"Code" means the Internal Revenue Code of 1986, as amended, reformed
----
or otherwise modified from time to time.
"Commitment" means, for each Lender, the amount in dollars set forth
----------
in Schedule 1.01(a) opposite the name of such Lender under the heading
----------------
"Commitments", as such amount may be (x) reduced from time to time as provided
-----------
in Sections 2.04, 2.05, 2.06 and/or 9.02 or (y) adjusted from time to time as a
-------------------------------------
result of assignments to or by such Lender as set forth in any Notice of
Assignment delivered hereunder pursuant to Section 11.08.
"Commitment Percentage" means, as to any Lender at any time, the
---------------------
percentage of the Aggregate Commitments represented by such Lender's Commitment
at such time, as set forth in Schedule 1.01(a), as such percentage may be
----------------
modified from time to time in accordance with any Notice of Assignment delivered
hereunder pursuant to Section 11.08.
-------------
"Company" has the meaning specified in the introduction to this
-------
Agreement.
"Contractual Obligation" means, with respect to any Person, any
----------------------
provision of any security issued by such Person or of any agreement,
undertaking, contract, indenture, mortgage, deed of trust or other instrument to
which such Person is a party or by which it or any of its property is subject.
"Controlled Group" means all members of a controlled group of
----------------
corporations and all members of a controlled group of trades or businesses
(whether or not incorporated) under common control which, together with the
Company, are treated as a single employer under Section 414(b) or 414(c) of the
Code or Section 4001 of ERISA.
"Debt Rating" means, on any date, the rating of the Company's senior
-----------
unsecured long-term Indebtedness, as most recently publicly announced by Moody's
and S&P, provided, however, (i) that if the ratings assigned by both Moody's and
-------- -------
S&P are one level apart, then the applicable interest rate margin and any fee to
be determined based on such rating, shall be determined by reference to the
higher rating, (ii) that if the ratings assigned by both Moody's and S&P are two
levels apart, then the applicable interest rate margin and any fees to be
determined based on such rating shall be determined by reference to the rating
level which is in between the two such ratings,
-3-
<PAGE>
(iii) that if the ratings assigned by both Moody's and S&P are three levels
apart, then the applicable interest rate margin and any fees to be determined
based on such rating shall be determined by reference to the rating level which
is one above the lower of such ratings and (iv) that if only one such rating is
available, then the applicable interest rate margin and any fees to be
determined based on such rating shall be determined solely by reference to such
one rating.
"Default" means any event or condition which, with the giving of
-------
notice or the lapse of time, or both, would become an Event of Default.
"Disposition" means, with respect to any property or asset, any sale,
-----------
lease, sale and leaseback, assignment, conveyance, transfer or other disposition
thereof consummated on or after the Closing Date.
"dollar" and "$" mean lawful money of the United States of America.
------ -
"Environmental Laws" means all applicable federal, state or local
------------------
statutes, laws, ordinances, codes, rules and regulations (including consent
decrees and administrative orders) relating to public health and safety and
protection of the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to sections of ERISA also refer to any successor sections.
"Eurocurrency Liabilities" has the meaning assigned to that term in
------------------------
Regulation D of the Federal Reserve Board, as in effect from time to time.
"Eurodollar Loan" means any Loan that bears interest at a rate
---------------
determined with reference to LIBOR.
"Eurodollar Reserve Percentage" means the maximum reserve percentage
-----------------------------
of any Lender (expressed as a decimal) in effect on the date LIBOR for any
Interest Period is determined under regulations issued from time to time by the
Federal Reserve Board for determining the maximum reserve requirement (including
any emergency, supplemental or other marginal reserve requirement) with respect
to liabilities or assets consisting of or including Eurocurrency Liabilities
having a term equal to such Interest Period.
"Event of Default" has the meaning specified in Section 9.01.
---------------- ------------
"Excluded Asset Sales" means the Disposition of inventory, equipment
--------------------
and other assets in the ordinary course of business.
"Federal Funds Rate" means, for any day, the rate set forth in the
------------------
weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Board (including any such
successor, "H.15(519)") for such day opposite the caption "Federal Funds
--------
(Effective"). If on any relevant day such rate is not yet published in
H.15(519), the rate for such day will be the rate set forth in the daily
statistical release designated as the Composite 3:30 p.m. Quotations for U.S.
Government Securities, or any successor publication, published by the Federal
-4-
<PAGE>
Reserve Bank of New York (including any such successor, the "Composite 3:30 p.m.
-------------------
Quotations") for such day under the caption "Federal Funds Effective Rate".
- ----------
"Federal Reserve Board" means the Board of Governors of the Federal
---------------------
Reserve System.
"Fee Letter" means the letter agreement dated June 25, 1999 between
----------
the Company and MSSF regarding the payment of certain fees.
"Form 1001" has the meaning specified in Section 3.05(f)(i)(B).
--------- ---------------------
"Form 4224" has the meaning specified in Section 3.05(f)(i)(A).
--------- ---------------------
"Form W-8" has the meaning specified in Section 3.05(f)(i)(B).
-------- ---------------------
"Form W-9" has the meaning specified in Section 3.05(f)(i)(A).
-------- ---------------------
"Funded Indebtedness" means, for any day, the sum of (i) all
-------------------
Indebtedness for Borrowed Money of the Company and its consolidated Subsidiaries
outstanding on such day plus (ii) the aggregate capital invested as of such day
----
by Persons other than the Company and its consolidated Subsidiaries in
receivables and other accounts sold to such Persons by the Company and its
consolidated Subsidiaries, excluding receivables and other accounts sold in
connection with the sale of a business or the sale of the assets and/or
operations generating such receivables and other accounts.
"GAAP" means, as of any date of determination, generally accepted
----
accounting principles set forth in the opinions and pronouncements of the
Accounting Principles Board and the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board (or agencies with similar functions of comparable stature and
authority within the accounting profession) or in such other statements by such
other entity as may be in general use by significant segments of the accounting
profession.
"Governmental Authority" means any nation or government, any federal,
----------------------
state, local or other political subdivision thereof and any central bank thereof
and any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Hazardous Material" means:
------------------
(a) any "hazardous substance", as defined by CERCLA;
(b) any "hazardous waste", as defined by the Resource Conservation and
Recovery Act, 42 U.S.C. Section 690, et seq., as in effect from time to
-- ----
time;
(c) any petroleum product; or
(d) any pollutant or contaminant or hazardous, dangerous or toxic
chemical, material or substance within the meaning of any other applicable
federal, state or local law, regulation, ordinance, or requirement
(including consent decrees and administrative orders)
-5-
<PAGE>
relating to or imposing liability or standards of conduct concerning any
hazardous, toxic or dangerous waste, substance or material, all as amended
or hereafter amended.
"Indebtedness" of any Person means, without duplication, the
------------
consolidated Indebtedness for Borrowed Money of such Person and guaranties of
indebtedness of others provided by such Person, all as determined in accordance
with GAAP consistent with the accounting principles applied in the preparation
of the Company's financial statements referred to in Section 5.05(a).
---------------
"Indebtedness for Borrowed Money" of any Person means, without
-------------------------------
duplication:
(a) all indebtedness of such Person for borrowed money;
(b) all obligations of such Person issued or assumed as the deferred
purchase price of property or services other than bank overdrafts and trade
accounts payable arising in the ordinary course of business consistent with
past practices;
(c) all obligations of such Person evidenced by notes, bonds,
debentures, commercial paper or similar instruments, including obligations
so evidenced incurred in connection with the acquisition of property,
assets or businesses;
(d) all indebtedness of such Person created or arising under any
conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of
the seller or creditor under such agreement in the event of default are
limited to repossession or sale of such property);
(e) all rental obligations of such Person under leases capitalized
under GAAP as disclosed in the financial statements delivered pursuant to
Section 7.09; and
------------
(f) all indebtedness of such Person or of others referred to in
paragraphs (a) through (e) above secured by (or for which the holder of
-------------- ---
such indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien upon or in property (including accounts and contract
rights) owned by such Person, even though such Person has not assumed or
become liable for the payment of such indebtedness.
"Indemnified Party" has the meaning specified in Section 11.05(a).
----------------- ----------------
"Interest Expense" means, for any period, (a) the total interest
----------------
expense of the Company and its consolidated Subsidiaries for such period minus
-----
(b) the total interest income of the Company and its consolidated Subsidiaries
for such period plus (c) the "cost of receivables sold" for such period as
----
reflected in the income statements delivered pursuant to Section 7.09.
------------
"Interest Payment Date" means (i) with respect to any Eurodollar Loan,
---------------------
the last day of each Interest Period applicable to such Eurodollar Loan and,
with respect to any Interest Period of six months' duration, the date which
falls three months after the beginning of such Interest Period, and (ii) with
respect to any Reference Rate Loan, the last Business Day of each calendar
quarter.
"Interest Period" means, with respect to any Eurodollar Loan, the
---------------
period commencing on the Business Day such Eurodollar Loan is disbursed or
continued as a Eurodollar Loan or on the
-6-
<PAGE>
date on which a Reference Rate Loan or any portion thereof is converted into a
Eurodollar Loan and ending on the date one, two, three or six months thereafter,
as selected by the Company in its Notice of Borrowing or Notice of
Conversion/Continuation; provided that:
--------
(a) in the case of the continuation of a Eurodollar Loan pursuant to
Section 2.10, the Interest Period applicable after the continuation of such
------------
Eurodollar Loan shall commence on the last day of the preceding Interest
Period;
(b) if any Interest Period would otherwise end on a day which is not a
Business Day, that Interest Period shall be extended to the next succeeding
Business Day, unless the result of such extension would be to carry such
Interest Period into another calendar month, in which event such Interest
Period shall end on the immediately preceding Business Day;
(c) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period) shall end on
the last Business Day of the calendar month at the end of such Interest
Period; and
(d) no Interest Period for any Eurodollar Loan shall extend beyond the
Maturity Date.
"Interest Rate Contracts" means interest rate cap agreements, interest
-----------------------
rate swap agreements, interest rate collar agreements, interest rate insurance
and other agreements or arrangements designed to provide protection against
fluctuations in interest rates.
"Investments" means all investments, whether by acquisition of stock
-----------
or indebtedness, or by loan, advance, transfer of property, capital contribution
or otherwise.
"Investments in Unrestricted Subsidiaries" means Investments made by
----------------------------------------
the Company or by any Restricted Subsidiary in Unrestricted Subsidiaries, net of
Investments made by Unrestricted Subsidiaries in the Company or any Restricted
Subsidiary. If any corporation which becomes a Restricted Subsidiary after the
date of this Agreement shall, at the time it becomes a Restricted Subsidiary,
have any Investments in an Unrestricted Subsidiary, such Investments shall be
deemed to be Investments made by the Company in such Unrestricted Subsidiary at
the time such corporation becomes a Restricted Subsidiary, in the amount at
which such Investments are then carried on the books of such corporation. If
any corporation shall become an Unrestricted Subsidiary after the date of this
Agreement, the Investments of the Company and its Restricted Subsidiaries in
such corporation shall be deemed to be Investments made at the time such
corporation becomes an Unrestricted Subsidiary, in the amount at which such
Investments are then carried on the books of the Company and its Restricted
Subsidiaries.
"Lender" has the meaning specified in the introduction to this
------
Agreement and includes each Lender listed on the signature pages hereof and each
Assignee.
"Lending Office" means, with respect to any Lender, the office or
--------------
offices of such Lender specified as its "Domestic Lending Office" or "Eurodollar
----------------------- ----------
Lending Office", as the case may be, opposite its name in Schedule 1.01(b) or in
- -------------- ----------------
the applicable Notice of Assignment, or such other
-7-
<PAGE>
office or offices of such Lender as such Lender may from time to time specify to
the Company and the Agent.
"LIBOR" means, for any Interest Period, the rate per annum that
appears on page 3750 of the Dow Jones Markets Screen/or any successor page for
dollar deposits with maturities comparable to the Interest Period applicable to
the Eurodollar Loans to be made (including by way of conversion) or continued
commencing two Business Days thereafter as of 11:00 a.m. (London time) on the
date which is two Business Days prior to the commencement of the respective
Interest Period; provided, however, to the extent that an interest rate is not
-------- -------
ascertainable pursuant to the foregoing provisions of this definition, the rate
to be used for purposes of this definition shall be the interest rate per annum
determined by the Agent to be the rate per annum at which deposits in dollars
are offered for such relevant Interest Period to the Agent in the London
interbank market in London, England at approximately 11:00 a.m. (London time) on
the date which is two Business Days prior to the beginning of such Interest
Period.
"Lien" means any mortgage, security interest, pledge or lien.
----
"Loan" means a loan by a Lender to the Company pursuant to Section
---- -------
2.01 and may be a Eurodollar Loan or a Reference Rate Loan, each of which shall
- ----
be a "type" of Loan.
----
"Loan Documents" means this Agreement, the Subsidiary Guaranty and any
--------------
promissory note issued pursuant hereto.
"Loan Parties" means, collectively, the Company and each other Person
------------
(other than the Agent and the Lenders) who is a party to a Loan Document.
"Loan Percentage" means, as to any Lender at any time, a fraction
---------------
(expressed as a percentage) the numerator of which is the outstanding principal
amount of the Loans of such Lender at such time and the denominator of which is
the aggregate outstanding principal amount of the Loans of all of the Lenders at
such time.
"Material Adverse Effect" means, with respect to any event, act,
-----------------------
condition or occurrence of whatever nature (including any adverse determination
in any litigation, arbitration, or governmental investigation or proceeding),
whether singly or in conjunction with any other event or events, act or acts,
condition or conditions, occurrence or occurrences, whether or not related, a
material adverse change in, or a material adverse effect upon, any of (a) the
financial condition, operations, business or properties of the Company and its
Subsidiaries taken as a whole and, with respect to the initial incurrence of
Loans, Unisource and its Subsidiaries taken as a whole or (b) the legality,
validity or enforceability of any Loan Document.
"Maturity Date" means June 28, 2000.
-------------
"Measurement Period" means a period consisting of four consecutive
------------------
fiscal quarters of the Company and ending on the last day of the most recently
completed fiscal quarter of the Company.
-8-
<PAGE>
"Merger" means the merger of Atlanta Acquisition with and into
------
Unisource pursuant to the Merger Agreement, with Unisource being the surviving
corporation of such merger.
"Merger Agreement" means the Agreement and Plan of Merger dated as of
----------------
May 25, 1999 among Unisource, the Company and Atlanta Acquisition.
"Merger Documents" means the Merger Agreement, the related certificate
----------------
of merger and all other agreements and documents related to the Merger.
"Moody's" means Moody's Investors Services, Inc. or any successor to
-------
the rating agency business thereof.
"MSSF" means Morgan Stanley Senior Funding, Inc.
----
"Net Cash Proceeds" means (a) in connection with any Asset Sale, the
-----------------
proceeds therefrom in the form of cash and cash equivalents (including any such
proceeds received by way of deferred payment of principal pursuant to a note or
installment receivable or purchase price adjustment receivable or otherwise, but
only as and when received) of such Asset Sale, after deducting therefrom, as
applicable, the reasonable costs of such Asset Sale (including fees and
commissions, payments of unassumed liabilities relating to the asset sold and
required payments of any Indebtedness which is secured by the respective assets
which were sold) and the incremental taxes paid or payable as a result of such
Asset Sale and (b) in connection with any Capital Markets Transaction, the cash
proceeds received from such Capital Markets Transaction, net of attorneys' fees,
investment banking fees, accountants' fees, underwriting discounts and
commissions and other customary fees and expenses actually incurred in
connection therewith.
"Net Tangible Assets" means, at any date, the aggregate amount of
-------------------
assets, including the amount of any receivables or other accounts of the Company
and its Subsidiaries sold in connection with any receivables sale transaction
(less applicable reserves and other properly deductible items) after deducting
therefrom (a) all current liabilities, (b) any item representing Investments in
Unrestricted Subsidiaries and (c) all goodwill, trade names, trademarks,
patents, unamortized debt discount and expenses and other like intangibles, all
of the foregoing as set forth on the then most recent consolidated balance sheet
of the Company and its Subsidiaries and computed in accordance with GAAP.
"Net Worth" means, at any date, the excess of Total Assets at such
---------
date over Total Liabilities at such date.
"Notice of Assignment" has the meaning specified in Section 11.08(b).
-------------------- ----------------
"Notice of Borrowing" has the meaning specified in Section 2.02(a).
------------------- ---------------
"Notice of Conversion/Continuation" has the meaning specified in
---------------------------------
Section 2.10(b).
- ---------------
"Obligations" means all Loans and other Indebtedness, advances, debts,
-----------
liabilities, obligations, covenants and duties owing by the Company or any other
Loan Party to any Lender, the Agent, any Affiliate of any Lender or the Agent or
any Indemnified Party, of any kind or nature, pre-
-9-
<PAGE>
sent or future, whether or not evidenced by any note, guaranty or other
instrument, but in each case only as arising under or in connection with this
Agreement or under or in connection with any other Loan Document, whether or not
for the payment of money, whether arising by reason of an extension of credit,
loan, guaranty, indemnification or in any other manner, whether direct or
indirect (including those acquired by assignment), absolute or contingent, due
or to become due, now existing or hereafter arising and however acquired. The
term "Obligations" includes all interest, charges, expenses, fees, attorneys'
-----------
fees and disbursements (including the allocated cost of in-house counsel) and
any other sum chargeable to the Company or any other Loan Party under or in
connection with this Agreement or any other Loan Document.
"Operating Cash Flow" means, for any Measurement Period, the sum of
-------------------
the Company's
(i) consolidated "income from operations before unusual items and
income taxes" for such period
plus
----
(ii) Interest Expense for such period to the extent deducted in
calculating "income from operations before unusual items and income taxes"
for such period
plus
----
(iii) the sum of the amounts reflected as components of consolidated
"items in net income not affecting cash" (other than "deferred income
taxes") for such period to the extent such amounts shall have been used in
calculating "income from operations before unusual items and income taxes"
for such period,
where the term "income from operations before unusual items and income
taxes" shall have the meaning given such term as reflected in the Company's
statements of income, and the terms "items in net income not affecting
cash" and "deferred income taxes" shall have the respective meanings given
those terms as reflected in the statements of cash flows, in each case,
referred to in Section 5.05(a) according to GAAP consistent with the
---------------
accounting principles applied in the preparation of such financial
statements.
"Other Taxes" has the meaning specified in Section 3.05(b).
----------- ---------------
"Participant" has the meaning specified in Section 11.08(d).
----------- ----------------
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
----
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in
------------ ------------
Section 3(2) of ERISA, which is subject to Title IV of ERISA (other than a
multiemployer plan as defined in Section 4001(a)(3) of ERISA), and to which the
Company or any corporation, trade, or business that is, along with the Company,
a member of its Controlled Group, may have liability, including a reasonable
possibility of liability due to having been a substantial employer within the
meaning of Section 4063
-10-
<PAGE>
of ERISA at any time during the preceding five years, or by reason of being
deemed to be a contributing sponsor under Section 4069 of ERISA.
"PEPS" means premium equity participating security units of the
----
Company.
"Permitted Liens" means the Liens permitted or required by Section
--------------- -------
8.01.
- ----
"Person" means an individual, partnership, corporation (including a
------
business trust), joint stock company, trust, unincorporated association, joint
venture or other entity, or a government or any political subdivision or agency
thereof.
"Plan" means each Pension Plan or Welfare Plan, and any other employee
----
benefit plan (within the meaning of Section 3(3) of ERISA) sponsored or
maintained by the Company or any Subsidiary of the Company.
"Principal Property" means any mill, manufacturing plant,
------------------
manufacturing facility or timberlands owned by the Company and/or one or more
Restricted Subsidiaries and located within the continental United States of
America; provided, however, that the term "Principal Property" shall not include
----------------- ------------------
(a) any such mill, plant, facility or timberlands or portion thereof (i) which
is financed by obligations issued by a State, a Territory or a possession of the
United States of America or any political subdivision of any of the foregoing,
or the District of Columbia, the interest on which is excludable from gross
income of the holders thereof pursuant to the provisions of Section 103(a)(1)
(but only if by reason of Section 103(b)(4)(E) or (F)) of the Internal Revenue
Code of 1954, as amended (or any predecessor or successor to such provision) as
in effect at the time of the issuance of such obligations, or (ii) which in the
opinion of the Company's Board of Directors is not of material importance to the
total business conducted by the Company and the Restricted Subsidiaries,
considered as a whole; or (b) any timberlands designated by the Company's Board
of Directors as being held primarily for development and/or sale rather than for
the production of timber; or (c) any minerals or mineral rights.
"Principal Subsidiary" means each of Great Northern Nekoosa
--------------------
Corporation, a Maine corporation; Brunswick Pulp & Paper Company, a Delaware
corporation; Georgia-Pacific West, Inc., an Oregon corporation; G-P Gypsum
Corporation, a Delaware corporation; Leaf River Forest Products, Inc., a
Delaware corporation; Nekoosa Packaging Corporation, a Delaware corporation;
Nekoosa Papers Inc., a Wisconsin corporation; and Atlanta Acquisition.
"Reference Rate" has the meaning specified in the definition of
--------------
Adjusted Reference Rate.
- -----------------------
"Reference Rate Loan" means any Loan that bears interest at a rate
-------------------
determined with reference to the Adjusted Reference Rate.
"Release" means a "release", as such term is defined in CERCLA.
------- -------
"Replacement Lender" has the meaning specified in Section 4.09.
------------------ ------------
-11-
<PAGE>
"Required Lenders" means, at any time, Lenders having 51% or more of
----------------
the Commitments and the aggregate unpaid principal amount of all outstanding
Loans and, if the Commitments have been terminated, Lenders holding 51% or more
of the then aggregate unpaid principal amount of the Loans made by the Lenders.
"Requirement of Law" means, as to any Person, the charter and by-laws
------------------
or other organization or governing documents of such Person, and any law, rule
or regulation including the requirements of Environmental Laws and ERISA, the
Securities Act of 1933, the Securities Exchange Act of 1934, Regulations T, U
and X of the Federal Reserve Board or any order, decree or other determination
of an arbitrator or a court or other Governmental Authority applicable to or
binding upon such Person or any of its property or to which such Person or any
of its property is subject.
"Responsible Officer" means, with respect to any Person, the Chief
-------------------
Executive Officer, the President, any Vice-Chairman or any of the Vice
Presidents or the Treasurer of such Person or, with respect to financial
matters, the Chief Financial Officer, the Executive Vice President-Finance and
Chief Financial Officer or the Vice President and Treasurer of such Person.
"Restricted Subsidiary" means any Subsidiary of the Company (a)
---------------------
substantially all of the property of which is located within the continental
United States of America and (b) which itself, or with the Company and/or one or
more other Restricted Subsidiaries, owns a Principal Property.
"Sale-Leaseback Transaction" has the meaning specified in Section
-------------------------- -------
8.02.
"S&P" means Standard & Poor's or any successor to the rating agency
---
business thereof.
"Subsidiary" means, with respect to any Person, any corporation of
----------
which more than 50% of the outstanding capital stock having ordinary voting
power to elect a majority of the board of directors (or others performing a
comparable function) of such corporation is at the time directly or indirectly
owned by such Person, by such Person and one or more other Subsidiaries of such
Person, or by one or more other Subsidiaries of such Person.
"Subsidiary Guaranty" has the meaning specified in Section 6.01(c).
------------------- ---------------
"Taxes" has the meaning specified in Section 3.05(a).
----- ---------------
"Tender Offer" means the offer by Atlanta Acquisition to purchase for
------------
cash all outstanding shares of the common stock of Unisource at a price per
share of $12 pursuant to the Tender Offer Documents.
"Tender Offer Documents" means Atlanta Acquisition's Offer to Purchase
----------------------
dated May 28, 1999 with respect to the Tender Offer and all other documents
related to the Tender Offer.
"Total Assets" means, at any date, without duplication, the total
------------
consolidated assets of the Company and its Subsidiaries, as determined in
accordance with GAAP.
"Total Liabilities" means, at any date, without duplication, the total
-----------------
consolidated liabilities of the Company and its Subsidiaries, determined in
accordance with GAAP.
-12-
<PAGE>
"Transaction" means, collectively, (i) the entering into of the Loan
-----------
Documents and the incurrence of Loans hereunder, (ii) the Tender Offer, (iii)
the Merger and (iv) the refinancing of approximately $640,000,000 of
Indebtedness of Unisource and its Subsidiaries.
"Transaction Documents" means the Loan Documents and the Acquisition
---------------------
Documents.
"Unisource" means Unisource Worldwide, Inc., a Delaware corporation.
---------
"Unrestricted Subsidiary" means any Subsidiary of the Company other
-----------------------
than a Restricted Subsidiary.
"Value" means, with respect to a Sale-Leaseback Transaction, as of any
-----
particular time, the amount equal to the greater of (a) the net proceeds of the
sale or transfer of the property leased pursuant to such Sale-Leaseback
Transaction or (b) the fair value in the opinion of the Board of Directors of
the Company of such property at the time of entering into such Sale-Leaseback
Transaction, in either case divided first by the number of full years of the
term of the lease and then multiplied by the number of full years of such term
remaining at the time of determination, without regard to any renewal or
extension options contained in the lease.
"Welfare Plan" means a "welfare plan", as such term is defined in
------------ ------------
Section (3)(1) of ERISA.
1.02 Computation of Time Periods. In this Agreement, in the
---------------------------
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
---- ------------------ -- -----
means "to but excluding".
----------------
1.03 Accounting Matters. All accounting terms not specifically
------------------
defined herein shall be construed in accordance with GAAP, and all financial
statements referred to in Sections 7.09(a) and (b) shall be prepared in
---------------- ---
accordance with GAAP; provided, however, that all computations determining
-------- -------
compliance with Article VIII shall use accounting principles consistent with
------------
those applied in the preparation of the financial statements of the Company
referred to in Section 5.05(a). The parties hereto agree that to the extent
---------------
that any change in GAAP affects the calculation of the financial covenant
contained herein, the Agent (at the direction of the Required Lenders) and the
Company shall negotiate in good faith to amend such financial covenant to
account for such changes in GAAP.
1.04 Certain Terms. The words "herein", "hereof" and "hereunder" and
------------- ------ ------ ---------
other words of similar import refer to this Agreement as a whole, including the
Exhibits and Schedules hereto, as the same may from time to time be amended or
supplemented, and not to any particular Article, Section, paragraph or clause in
this Agreement. The word "including" when used herein is not intended to be
---------
exclusive and means "including, without limitation". References herein to an
-----------------------------
Article, Section, paragraph or clause shall refer to the appropriate Article,
Section, paragraph or clause in this Agreement.
-13-
<PAGE>
ARTICLE II
AMOUNTS AND TERMS OF THE LOANS
------------------------------
2.01 Loans. Each Lender severally agrees, on the terms and subject
-----
to the conditions hereinafter set forth, to make a term loan (each a "Loan" and,
collectively, the "Loans") to the Company on any Borrowing Date on or after the
Closing Date in an aggregate principal amount not to exceed such Lender's
Commitment on any such Borrowing Date. Any principal amount of Loans which is
repaid or prepaid by the Company may not be reborrowed.
2.02 Procedure for Borrowings. (a) Each Borrowing shall be made on
------------------------
notice, delivered by the Company to the Agent not later than 12:00 noon (New
York City time) at least (i) three Business Days prior to the date of such
proposed Borrowing, in the case of Eurodollar Loans, and (ii) one Business Day
prior to the date of such proposed Borrowing, in the case of Reference Rate
Loans. Each such notice of borrowing (a "Notice of Borrowing") shall be
-------------------
irrevocable and shall be by facsimile or telex, in substantially the form of
Exhibit 2.02, specifying therein:
- ------------
(i) the date of such Borrowing, which shall be a Business Day;
(ii) the amount of such Borrowing which, in the case of a Borrowing
of Eurodollar Loans, shall be in the amount of $20,000,000 or an integral
multiple of $10,000,000 in excess thereof and, in the case of a Borrowing
of Reference Rate Loans, shall be in the amount of $10,000,000 or an
integral multiple of $5,000,000 in excess thereof;
(iii) whether such Borrowing is to be comprised of Eurodollar Loans
or Reference Rate Loans; and
(iv) if such Borrowing is to be comprised of Eurodollar Loans, the
duration of the initial Interest Period applicable to such Eurodollar
Loans.
If a Notice of Borrowing shall fail to specify the duration of the initial
Interest Period for any Borrowing comprised of Eurodollar Loans, such Interest
Period shall be one month.
(b) Upon receipt of a Notice of Borrowing, the Agent shall promptly
notify each Lender thereof and of the amount of such Lender's pro rata share of
--- ----
such Borrowing determined on the basis of such Lender's Commitment Percentage.
Each Lender shall make available to the Agent the amount of its ratable share of
such Borrowing in the manner and at the time set forth in Section 3.04(a).
---------------
(c) Notwithstanding anything to the contrary contained in this
Agreement, at no time shall there be more than four different Interest Periods
in effect.
(d) Unless any applicable condition specified in Article VI has not
----------
been satisfied or waived, the Agent will make the funds received from the
Lenders promptly available to the Company by crediting the account of the
Company on the books of the Agent, or such other account as shall have been
specified by the Company, with the aggregate of the amounts made available to
the Agent by the Lenders and in like funds as received by the Agent.
-14-
<PAGE>
2.03 Evidence of Indebtedness. (a) Each Lender, with respect to
------------------------
amounts payable to it hereunder, and the Agent, with respect to all amounts
payable hereunder in respect of the Loans, shall maintain on its books in
accordance with its usual practice, loan accounts and control accounts,
respectively, setting forth each Loan and the applicable interest rate and the
amounts of principal, interest and other sums paid and payable by the Company
from time to time hereunder with respect thereto; provided, however, that the
-------- -------
failure by any Lender to record any such amount on its books shall not affect
the obligations of the Company with respect thereto. In the case of any
dispute, action or proceeding relating to any amount payable hereunder, the
entries in each such account shall be prima facie evidence of such amount,
absent manifest error. In case of any discrepancy between the entries in the
Agent's books and any Lender's books, such Lender's books shall be considered
correct in the absence of manifest error.
(b) Notwithstanding the foregoing, if any Lender shall so request for
purposes of Section 11.08(a)(iii), the obligation to repay the Loans shall also
---------------------
be evidenced by a promissory note in the form of Exhibit 2.03(b).
---------------
2.04 Optional Reduction of the Commitments. The Company shall have
-------------------------------------
the right, upon at least one Business Day's prior notice to the Agent (which
notice shall be irrevocable), at any time permanently to terminate the remaining
Commitments in whole or reduce ratably in part the unused portions of the
Commitments of the Lenders (based on the respective Commitment Percentages of
the Lenders); provided, however, that each partial reduction shall be in the
-------- -------
aggregate amount of $20,000,000 or an integral multiple of $10,000,000 in excess
thereof. The Agent shall promptly notify each Lender of its receipt of any
notice under this Section 2.04.
------------
2.05 Mandatory Reduction of the Commitments. (a) The Aggregate
--------------------------------------
Commitments (and the Commitment of each Lender) shall terminate in their
entirety at 5:00 p.m. (New York City time) on October 15, 1999.
(b) In addition to any other mandatory commitment reductions pursuant
to this Section 2.05, the Aggregate Commitments (and the ratable portion of the
Commitments of the Lenders based on their respective Commitment Percentages)
shall (i) be reduced on each Borrowing Date (in each case, after giving effect
to the incurrence of the Loans on each such date), in each case, in an amount
equal to the aggregate principal amount of the Loans incurred on each such date
and (ii) prior to the termination thereof, be reduced from time to time to the
extent required by Section 2.06.
2.06 Repayment and Commitment Reductions. (a) On each date on which
-----------------------------------
the Company or any Subsidiary of the Company receives any cash proceeds of
$100,000,000 or more from any Asset Sale or series of related Asset Sales, an
amount equal to 100% of the Net Cash Proceeds from such Asset Sale or series of
related Asset Sales shall be applied on such date as a mandatory repayment of
principal of outstanding Loans and/or as a mandatory reduction to the Aggregate
Commitments in accordance with the requirements of Section 2.06(d).
(b) On each date on which the Company or any Subsidiary of the
Company consummates a Capital Markets Transaction, an amount equal to 100% of
the Net Cash Proceeds from such Capital Markets Transaction shall be applied on
such date as a mandatory repayment of principal of outstanding Loans and/or as a
mandatory reduction to the Aggregate Commitments in accordance with the
requirements of Section 2.06(d).
-15-
<PAGE>
(c) The Company agrees to repay to the Agent, for the account of the
Lenders, the outstanding principal amount of all Loans on the Maturity Date.
(d) Each repayment of Loans and each reduction to the Aggregate
Commitments pursuant to this Section 2.06 shall be applied (i) first, to repay
the outstanding principal amount of the Loans in accordance with the immediately
succeeding sentence and (ii) second, to the extent in excess thereof, to
permanently reduce the Aggregate Commitments in accordance with the requirements
of Section 2.05(b)(ii). Each amount required to be applied to the outstanding
Loans shall be applied pro rata among the Lenders in accordance with their Loan
--- ----
Percentages of the amount of such repayment; provided, however, that, if the
-------- -------
aggregate amount of Eurodollar Loans comprised in the same Borrowing would be
reduced as a result of any repayment pursuant to paragraph (a) or (b) of this
--------- --- ---
Section 2.06 to an amount less than $20,000,000, such Eurodollar Loan shall
- ------------
automatically convert into Reference Rate Loans on the last day of the then
current Interest Period.
2.07 Optional Prepayments. (a) Subject to Section 4.06(a), the
-------------------- ---------------
Company may, upon (i) at least three Business Days' prior notice to the Agent,
in the case of a prepayment of Eurodollar Loans, and (ii) at least one Business
Day's prior notice to the Agent, in the case of a prepayment of Reference Rate
Loans, stating the proposed date and aggregate principal amount of the
prepayment, prepay, ratably among the Lenders in accordance with their Loan
Percentages, the outstanding principal amount of the Loans, in whole or in part,
together with accrued interest to the date of such prepayment on the principal
amount prepaid.
(b) Each partial prepayment of Loans shall, in the case of Eurodollar
Loans, be in the aggregate principal amount of $20,000,000 or an integral
multiple of $10,000,000 in excess thereof, and, in the case of Reference Rate
Loans, be in the aggregate principal amount of $10,000,000 or an integral
multiple of $5,000,000 in excess thereof; provided, however, that, if the
-------- -------
aggregate amount of Eurodollar Loans comprised in the same Borrowing would be
reduced as a result of any voluntary prepayment to an amount less than
$20,000,000, such Eurodollar Loans shall automatically convert into Reference
Rate Loans on the last day of the then current Interest Period.
(c) If a notice of prepayment is given, such notice shall be
irrevocable and the principal amount stated in such notice, together with
accrued interest thereon and any amount payable pursuant to Section 4.06(a),
---------------
shall be due and payable on the date specified in such notice. The Agent shall
promptly notify each Lender of its receipt of any notice of prepayment under
this Section 2.07.
------------
2.08 Interest. (a) Each Loan shall bear interest on the outstanding
--------
principal amount thereof from the date when made until paid in full, at the
option of the Company, as set forth in its Notice of Borrowing or in its Notice
of Conversion/Continuation,
(i) if such Loan is a Reference Rate Loan, at a rate per annum
equal to the Adjusted Reference Rate; or
(ii) if such Loan is a Eurodollar Loan, at a rate per annum equal to
the sum of (A) LIBOR plus (B) the applicable margin, as set forth in the
----
table below:
-16-
<PAGE>
<TABLE>
<CAPTION>
Debt Rating Applicable Margin
-----------
on Eurodollar
Moody's S&P Loans
------- --- -----------------
<S> <C> <C>
Baal or higher or BBB+ or higher .625%
--
Baa2 or BBB .725%
--
Baa3 or BBB- .825%
--
Bal or lower or BB+ or lower 1.000%
</TABLE>
provided, however, that if at any time no Debt Rating is available, the
- -------- -------
applicable margin shall be 1.000%.
(b) Any change in the applicable margin due to a change in the
applicable Debt Rating shall be effective on the effective date of such change
in the applicable Debt Rating and shall apply to all Eurodollar Loans that are
outstanding at any time during the period commencing on the effective date of
such change in applicable Debt Rating and ending on the date immediately
preceding the effective date of the next such change in applicable Debt Rating.
(c) Accrued interest shall be paid on each Interest Payment Date (and,
after maturity, on demand), on the date of repayment or prepayment of any Loan
on the amount repaid or prepaid and, in the case of any Reference Rate Loan, on
each date such Loan is converted into a Eurodollar Loan.
2.09 Default Interest. During the continuation of any Event of
----------------
Default pursuant to Section 9.01(a), the Company shall pay interest (after as
---------------
well as before judgment to the extent permitted by law) on the principal amount
of all Loans outstanding and on all other Obligations of the Company due and
unpaid, (i) at a rate per annum (x) in the case of Eurodollar Loans, which is
determined by increasing the interest rate then in effect by 2% per annum for
the principal amount of the Eurodollar Loans outstanding and (y) in the case of
Reference Rate Loans, which is determined by increasing the interest rate then
in effect by 2% per annum for the principal amount of the Reference Rate Loans
outstanding and (ii) in the case of any other Obligation due hereunder, at a
rate per annum equal to the interest rate then in effect for Reference Rate
Loans plus 2%.
2.10 Continuation and Conversion Elections for Loans. (a) The
-----------------------------------------------
Company may upon irrevocable written notice to the Agent:
(i) elect to convert, on any Business Day, all or any portion of
outstanding Reference Rate Loans (in the aggregate amount of $20,000,000 or
an integral multiple of $10,000,000 in excess thereof) into Eurodollar
Loans;
(ii) elect to convert, on the last day of any Interest Period
therefor, all or any portion of outstanding Eurodollar Loans comprising the
same Borrowing (in the aggregate amount of $10,000,000 or an integral
multiple of $5,000,000 in excess thereof) into Reference Rate Loans; or
(iii) elect to continue, on the last day of any Interest Period
therefor, any Eurodollar Loans;
-17-
<PAGE>
provided, however, that if the aggregate amount of outstanding Eurodollar Loans
- -------- -------
comprised in the same Borrowing would be reduced as a result of any conversion
of part thereof to Reference Rate Loans to an amount less than $20,000,000, such
Eurodollar Loans shall automatically convert into Reference Rate Loans on the
last day of the Interest Period on which such conversion occurs.
(b) The Company shall deliver a notice of conversion or continuation
(a "Notice of Conversion/Continuation"), in substantially the form of Exhibit
--------------------------------- -------
2.10, to the Agent not later than 12:00 noon (New York City time) (i) three
- ----
Business Days prior to the proposed date of conversion or continuation, if the
Loans or any portion thereof are to be converted into or continued as Eurodollar
Loans, and (ii) one Business Day prior to the proposed date of conversion, if
the Loans or any portion thereof are to be converted into Reference Rate Loans.
Each such Notice of Conversion/Continuation shall be irrevocable and shall be
made by facsimile or telex, specifying therein:
(i) the proposed date of conversion or continuation;
(ii) the aggregate amount of Loans to be converted or continued;
and
(iii) the duration of the applicable Interest Period if such Loans
are Eurodollar Loans.
(c) If, on the third Business Day prior to the expiration of any
Interest Period applicable to Eurodollar Loans, the Company shall have failed to
select a new Interest Period to be applicable to such Eurodollar Loans, the
Company shall be deemed to have elected to convert such Eurodollar Loans into
Reference Rate Loans effective as of the last day of such Interest Period.
(d) Upon receipt of a Notice of Conversion/Continuation, the Agent
shall promptly notify each Lender thereof. All conversions and continuations
shall be made ratably among the Lenders based on their Loan Percentages of the
Loans with respect to which such notice was given.
(e) Notwithstanding any other provision contained in this Agreement,
after giving effect to any conversion or continuation of any Loans, there shall
not be more than four different Interest Periods for Eurodollar Loans in effect.
ARTICLE III
FEES; PAYMENTS; TAXES
---------------------
3.01 Fees. (a) Usage Fee.
---- ---------
(i) For each day on which the aggregate outstanding principal
amount of all of the Loans exceeds $330,000,000, the Company agrees to pay to
the Agent for the ratable account of each Lender, a per annum usage fee on the
aggregate outstanding principal amount of all of the Loans at a rate per annum
as follows:
-18-
<PAGE>
<TABLE>
<CAPTION>
Debt Rating
-----------
Moody's S&P Usage Fee
------- --- ---------
<S> <C> <C>
Baal or higher or BBB+ or higher 0.100%
--
Baa2 or BBB 0.125%
--
Baa3 or BBB- 0.250%
--
Bal or lower and BB+ or lower 0.250%
---
</TABLE>
provided, however, that if at any time no Debt Rating is available, the usage
- -------- -------
fee shall be 0.250% per annum.
(ii) The usage fee shall be payable (A) quarterly in arrears on the
last Business Day of each calendar quarter, commencing with the calendar
quarter ending on September 30, 1999, and (B) on the date on which all
outstanding Loans have been repaid in full and the Aggregate Commitments
have been terminated.
(b) Facility Fee.
-------------
(i) The Company agrees to pay to the Agent for the ratable account
of each Lender, a per annum facility fee from the Closing Date until the
date on which all outstanding Loans have been repaid in full and the
Aggregate Commitments have been terminated at a rate per annum times the
Aggregate Total Amount as follows:
<TABLE>
<CAPTION>
Debt Rating
-----------
Moody's S&P Facility Fee
------- --- ------------
<S> <C> <C>
Baal or higher or BBB+ or higher 0.125%
--
Baa2 or BBB 0.150%
--
Baa3 or BBB- 0.175%
--
Bal or lower and BB+ or lower 0.375%
---
</TABLE>
provided, however, that if at any time no Debt Rating is available, the
facility fee shall be 0.375% per annum.
(i) The facility fee shall be payable (A) quarterly in arrears on
the last Business Day of each calendar quarter, commencing with the
calendar quarter ending on September 30, 1999, and (B) on the date on which
all outstanding Loans have been repaid in full and the Aggregate
Commitments have been terminated.
(c) The Company agrees to pay to the Agent for its account such
fees in such amounts and at such times as are set forth in the Fee Letter.
3.02 Computation of Interest, Fees. (a) All computations of
-----------------------------
interest payable in respect of Reference Rate Loans shall be made on the basis
of a year of 365 days or 366 days, as the case may be, and actual days elapsed.
All computations of interest in respect of Eurodollar Loans and all computations
of fees shall be made on the basis of a year of 360 days and actual days
elapsed. Interest and fees shall accrue during each period during which
interest or such fees are computed from the first day thereof to the last day
thereof.
-19-
<PAGE>
(b) Each determination of an interest rate by the Agent pursuant to
any provision of this Agreement shall be conclusive and binding on the Company
and the Lenders in the absence of manifest error. The Agent, upon determining
LIBOR for any Interest Period, shall promptly notify the Company and the Lenders
thereof.
3.03 Payments by the Company. (a) The Company shall make each payment
-----------------------
hereunder not later than 1:00 p.m. (New York City time) on the day when due to
the Agent, without defense, setoff or counterclaim, in dollars and in
immediately available funds to such account in the continental United States of
America as the Agent shall specify from time to time by notice to the Company.
The Agent will promptly after receiving any payment in respect of any Loan from
the Company cause to be distributed like funds to the Lenders ratably based on
their Loan Percentages and/or Commitment Percentages (other than amounts payable
to any Lender pursuant to Section 3.05, 4.02, 4.03, 4.04, 4.05 or 4.06) for the
------------------------------------ ----
account of their respective Lending Offices. Any payment which is received by
the Agent later than 1:00 p.m. (New York City time), as confirmed by Federal
Reserve wire number, shall be deemed to have been received on the immediately
succeeding Business Day.
(b) Whenever any payment of a Loan shall be stated to be due on a day
other than a Business Day, such payment shall be made on the next succeeding
Business Day, and such extension of time shall in such case be included in the
computation of payment of interest or fees, as the case may be; provided,
--------
however, that if such extension would cause payment of principal of or interest
- -------
on Eurodollar Loans to be made in the next calendar month, such payment shall be
made on the immediately preceding Business Day.
(c) Unless the Agent shall have received notice from the Company
prior to the date on which any payment is due to the Lenders hereunder that the
Company will not make such payment in full, the Agent may assume that the
Company has made such payment in full to the Agent on such date, and the Agent
may, in reliance upon such assumption, cause to be distributed to each Lender on
such due date an amount equal to the amount then due such Lender. If and to the
extent the Company shall not have so made such payment in full to the Agent,
each Lender shall repay to the Agent forthwith on demand the excess of the
amount distributed to such Lender over the amount, if any, paid by the Company
for the account of such Lender, together with interest thereon at the Federal
Funds Rate, for each day from the date such amount is distributed to such Lender
until the date such Lender repays such amount to the Agent; provided, however,
-------- -------
that if any Lender shall fail to repay such amount within three Business Days
after demand therefor, such Lender shall, from and after such third Business Day
until payment is made to the Agent, pay interest thereon at a rate per annum
equal to the sum of the Adjusted Reference Rate plus 1%.
3.04 Payments by the Lenders. (a) Not later than 12:00 noon (New
-----------------------
York City time) on the date of each proposed Borrowing, each Lender shall make
available to the Agent to such account as the Agent shall specify from time to
time in immediately available funds for the account of the Company, the amount
of such Lender's Commitment Percentage of such Borrowing.
(b) Unless the Agent shall have received notice from a Lender at
least one Business Day prior to the date of any proposed Borrowing that such
Lender will not make available to the Agent for the account of the Company, the
amount of such Lender's Commitment Percentage
-20-
<PAGE>
of such Borrowing, the Agent may assume that such Lender has made such amount
available to the Agent on the date of such Borrowing, and the Agent may, in
reliance upon such assumption, make available to the Company on such date a
corresponding amount. If and to the extent any Lender shall not have made such
full amount available to the Agent, and the Agent in such circumstances makes
available to the Company such amount, such Lender shall, within two Business
Days following the date of such Borrowing, make such amount available to the
Agent, together with interest thereon for each day from and including the date
of such Borrowing, at a rate per annum equal to the Federal Funds Rate. If such
amount is so made available, such payment to the Agent shall constitute such
Lender's Loan on the date of such Borrowing for all purposes of this Agreement.
If such amount is not made available to the Agent within two Business Days
following the date of such Borrowing, the Agent shall notify the Company of such
failure to fund, and, on the third Business Day following the date of such
Borrowing, the Company shall pay to the Agent such amount, together with
interest thereon for each day elapsed since the date of such Borrowing, at a
rate per annum equal to the interest rate applicable at the time to the Loans
comprising such Borrowing. Nothing contained in this Section 3.04(b) shall
---------------
relieve any Lender which has failed to make available its pro rata share of any
Borrowing hereunder from its obligation to do so in accordance with the terms
hereof.
(c) The failure of any Lender to make any Loan on the date of any
Borrowing shall not relieve any other Lender of its obligation, if any,
hereunder to make a Loan on the date of such Borrowing pursuant to the
provisions contained herein, but no Lender shall be responsible for the failure
of any other Lender to make the Loan to be made by such other Lender on the date
of any Borrowing.
3.05 Taxes. (a) Subject to paragraph (g) of this Section 3.05, any and
----- ------------- ------------
all payments by the Company to the Agent for its account and for the account of
any Lender under this Agreement shall be made free and clear of, and without
deduction or withholding for, any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto incurred in connection with any Loans or Borrowings pursuant to this
Agreement, excluding (i) such taxes (including income taxes or franchise taxes
or branch profit taxes) as are imposed on or measured by such Lender's or the
Agent's, as the case may be, net income and (ii) such taxes as are imposed by a
jurisdiction other than the United States of America or any political
subdivision thereof and that would not have been imposed but for the existence
of a connection between such Lender or the Agent and the jurisdiction imposing
such taxes (other than a connection arising principally by reason of this
Agreement) (all such non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities being hereinafter referred to as "Taxes").
-----
(b) In addition, the Company agrees to pay any present or future
stamp or documentary taxes or any other sales, excise or property taxes, charges
or similar levies which arise from any payment made hereunder or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement or any other Loan Document (hereinafter referred to as "Other Taxes").
-----------
(c) Subject to paragraph (g) of this Section 3.05, the Company agrees
------------- ------------
to indemnify and hold harmless each Lender and the Agent for the full amount of
Taxes or Other Taxes (including any Taxes or Other Taxes imposed by any
jurisdiction on amounts payable under this Section 3.05) paid by such Lender or
------------
the Agent, as the case may be, and any liability (including penalties, interest,
additions to tax and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or
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<PAGE>
Other Taxes were correctly or legally asserted; provided, however, that each
-------- -------
Lender and the Agent agree to contest in good faith in cooperation with the
Company any Taxes or Other Taxes that such Lender or the Agent, as the case may
be, in consultation with the Company has determined have been incorrectly
asserted. This indemnification shall be made within 30 days from the date such
Lender or the Agent, as the case may be, makes written demand therefor.
(d) If the Company shall be required by law to deduct or withhold
any Taxes or Other Taxes from or in respect of any sum payable hereunder to any
Lender or the Agent, then, subject to paragraph (g) of this Section 3.05,
------------- ------------
(i) the sum payable shall be increased as may be necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section 3.05), such Lender or the Agent,
------------
as the case may be, receives an amount equal to the sum it would have
received had no such deductions been made;
(ii) the Company shall make such deductions; and
(iii) the Company shall pay the full amount deducted to the relevant
taxation authority or other authority in accordance with applicable law.
(e) Within 30 days after the date of any payment by the Company of
Taxes or Other Taxes under this Section 3.05, the Company will furnish to the
------------
Agent, for the account of each Lender receiving a payment from which Taxes or
Other Taxes were deducted, the original or a certified copy of a receipt
evidencing payment thereof, or other evidence of payment reasonably satisfactory
to the Agent.
(f) Each Lender that is other than a United States Person as defined
in the Code hereby agrees that:
(i) it shall, no later than the Closing Date (or, in the case of a
Lender which becomes a party hereto pursuant to Section 11.08 after the
-------------
Closing Date, the date upon which such Lender becomes a party hereto)
deliver to the Agent (two (2) originals) and to the Company (one (1)
original):
(A) if its Lending Office is located in the United States of
America, accurate and complete signed originals of Internal Revenue Service
Form 4224 or any successor thereto ("Form 4224") and Internal Revenue
---------
Service Form W-9 or any successor thereto ("Form W-9"), and/or
--------
(B) if its Lending Office is located outside the United States of
America, accurate and complete signed originals of Internal Revenue Service
Form 1001 or any successor thereto ("Form 1001") and Internal Revenue
---------
Service Form W-8 or any successor thereto ("Form W-8");
--------
in each case indicating that such Lender is on the date of delivery thereof
entitled to receive payments of principal, interest and fees for the
account of such Lending Office or Offices under this Agreement free from
withholding of United States Federal income tax;
-22-
<PAGE>
(ii) if at any time such Lender changes its Lending Office or
Offices or selects an additional Lending Office, it shall, at the same time
or reasonably promptly thereafter but only to the extent the forms
previously delivered by it hereunder are no longer effective, deliver to
the Agent (two originals) and to the Company (one original) in replacement
for the forms previously delivered by it hereunder:
(A) if such changed or additional Lending Office is located in the
United States of America, accurate and complete signed originals of Form
4224 and Form W-9; or
(B) otherwise, accurate and complete signed originals of Form 1001
and Form W-8,
in each case indicating that such Lender is on the date of delivery thereof
entitled to receive payments of principal, interest and fees for the
account of such changed or additional Lending Office under this Agreement
free from withholding of United States Federal income tax;
(iii) it shall, before or promptly after the occurrence of any event
(including the passing of time and, as provided above, any event mentioned
in clause (ii) above) requiring a change in the most recent Form 4224, Form
-----------
W-9, Form 1001 or Form W-8 previously delivered by such Lender and if no
change in law shall have occurred since the date of delivery of such most
recent form that would make the delivery of replacement forms hereunder
unlawful, deliver to the Agent (two originals) and to the Company (one
original) accurate and complete signed originals of Form 4224 and Form W-9
or Form 1001 and Form W-8 (or any successor forms) in replacement for the
forms previously delivered by such Lender; and
(iv) it shall, promptly upon the request of the Company to that
effect, deliver to the Agent and the Company such other accurate and
complete forms or similar documentation as may be required from time to
time by any applicable law, treaty, rule or regulation in order to
establish such Lender's tax status for withholding purposes or may
otherwise be appropriate to eliminate or minimize any Taxes on payments
under this Agreement.
(g) The Company shall not be required to pay any amounts pursuant to
paragraph (a), (c) or (d) of this Section 3.05 to any Lender for the account of
- ------------- --- --- ------------
any Lending Office of such Lender in respect of any sum payable hereunder:
(i) if the obligation to pay such additional amounts would not have
arisen but for a failure by such Lender to comply with its obligations
under Section 3.05(f) in respect of such Lending Office;
---------------
(ii) if such Lender shall have delivered to the Agent a Form 4224
and a Form W-9 in respect of such Lending Office pursuant to subclause
---------
(f)(i)(A), (f)(ii)(A) or (f)(iii) above and such Lender shall not be
--------------------- --------
entitled to exemption from deduction or withholding of United States
Federal income tax in respect of the payment of such sum by the Company
hereunder for the account of such Lending Office for any reason other than
a change in United States law or regulations or in the official
interpretation of such law or regulations by any Governmental Authority
charged with the interpretation or administration thereof (whether or not
having the
-23-
<PAGE>
force of law) after the date of delivery of such Form 4224 and Form W-9;
provided, however, that if, notwithstanding such change in law, a Lender
-------- -------
would be legally able to provide such other forms or information as would
reduce or eliminate United States withholding taxes applicable to payments
made hereunder, such Lender shall, if requested by the Company, timely
provide such forms or other information to the Company, and the Company
shall not be required to pay any amounts pursuant to paragraphs (a), (c) or
-------------- ---
(d) above to the extent such amount would not have been owed but for a
---
failure of such Lender to comply with its obligations under this proviso;
or
(iii) if such Lender shall have delivered to the Company a Form 1001
and a Form W-8 in respect of such Lending Office pursuant to subclause
---------
(f)(i)(B), (f)(ii)(B) or (f)(iii) above and such Lender shall not be
--------- ---------- --------
entitled to exemption from deduction or withholding of United States
Federal income tax in respect of the payment of such sum by the Company
hereunder for the account of such Lending Office for any reason other than
a change in United States law or regulations or any applicable tax treaty
or regulations or in the official interpretation of any such law, treaty or
regulations by any Governmental Authority charged with the interpretation
or administration thereof (whether or not having the force of law) after
the date of delivery of such Form 1001 and Form W-8; provided, however,
-------- -------
that if, notwithstanding such change in law, a Lender would be legally able
to provide such other forms or information as would reduce or eliminate
United States withholding taxes applicable to payments made hereunder, such
Lender shall, if requested by the Company, timely provide such forms or
other information to the Company, and the Company shall not be required to
pay any amounts pursuant to paragraph (a), (c) or (d) of this Section 3.05
------------- --- --- ------------
to the extent such amount would not have been owed but for a failure of
such Lender to comply with its obligations under this proviso.
(h) Each Lender shall use reasonable efforts to avoid or minimize any
amounts which might otherwise be payable pursuant to this Section 3.05;
------------
provided, however, that such efforts shall not include the taking of any actions
- -------- -------
by a Lender that would result in any tax, cost or other expense to such Lender
(other than a tax, cost or expense for which such Lender shall have been
reimbursed or indemnified by the Company pursuant to this Agreement or
otherwise) or any action which would in the reasonable opinion of such Lender
have an adverse effect upon its financial condition, operations, business or
properties.
(i) Each Lender agrees to indemnify the Agent and hold the Agent
harmless for the full amount of any and all present or future Taxes, Other Taxes
and related liabilities (including penalties, interest, additions to tax and
expenses, and any Taxes or Other Taxes imposed by any jurisdiction on amounts
payable to Agent under this paragraph (i)) which are imposed on or with respect
-------------
to principal, interest or fees payable to such Lender hereunder and which are
not paid by the Company pursuant to this Section 3.05, whether or not such
------------
Taxes, Other Taxes or related liabilities were correctly or legally asserted.
This indemnification shall be made within 30 days from the date the Agent makes
written demand therefor.
3.06 Sharing of Payments, Etc. If, other than as provided in Section
------------------------ -------
3.05, 4.02, 4.03, 4.04, 4.05 or 4,06, any Lender shall obtain any payment
- ---------------------------- ----
(whether voluntary, involuntary, through the exercise of any right of set-off or
otherwise) on account of any Loan made by it or, after the
-24-
<PAGE>
occurrence and during the continuation of an Event of Default pursuant to
Section 9.01(a), in respect of any Obligation owing to it in excess of its Loan
- ---------------
Percentage and/or Commitment Percentage, as the case may be, of payments on
account of the Loans or, after the occurrence and during the continuation of an
Event of Default pursuant to Section 9.01(a), in excess of its pro rata share of
---------------
all Obligations, such Lender shall forthwith purchase from the other Lenders
such participations in the Loans made by them or, after the occurrence and
during the continuation of an Event of Default pursuant to Section 9.01(a), in
---------------
all Obligations owing to them, as shall be necessary to cause such purchasing
Lender to share the excess payment ratably with each of the other Lenders
according to their Loan Percentages and/or Commitment Percentage, as the case
may be, or, after the occurrence and during the continuation of an Event of
Default pursuant to Section 9.01(a), their pro rata shares of all Obligations
---------------
then owing to them; provided, however, that if all or any portion of such excess
-------- -------
payment is thereafter recovered from such purchasing Lender, such purchase by
such Lender from each other Lender shall be rescinded and each other Lender
shall repay to the purchasing Lender the purchase price to the extent of such
recovery together with an amount equal to such paying Lender's pro rata share
(according to the proportion of (a) the amount of such paying Lender's required
repayment to the purchasing Lender to (b) the total amount so recovered from the
purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect of the total amount so recovered. The Company
agrees that any Lender so purchasing a participation from another Lender
pursuant to the provisions of this Section 3.06 may, to the fullest extent
------------
permitted by law, exercise all its rights of payment (including the right of
set-off) with respect to such participation as fully as if such Lender were the
direct creditor of the Company in the amount of such participation. If under any
applicable bankruptcy, insolvency or other similar law, any Lender receives a
secured claim in lieu of a setoff to which this Section 3.06 applies, such
------------
Lender shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Lenders entitled
under this Section 3.06 to share in the benefits of any recovery on such secured
------------
claim.
ARTICLE IV
CHANGES IN CIRCUMSTANCES; ETC.
------------------------------
4.01 Eurodollar Rate Protection. If with respect to any Interest
--------------------------
Period for Eurodollar Loans, by the first day of such Interest Period, the
Required Lenders notify the Agent that LIBOR for such Interest Period will not
adequately reflect the cost to the Required Lenders of making such Eurodollar
Loans or funding or maintaining their respective Eurodollar Loans for such
Interest Period, the Agent shall forthwith so notify the Company and the
Lenders, whereupon the obligations of the Lenders to make or continue Loans as
Eurodollar Loans or to convert Reference Rate Loans into Eurodollar Loans shall
be suspended until the Agent shall notify the Company and the Lenders that the
circumstances causing such suspension no longer exist and any then outstanding
Eurodollar Loans shall at the end of the then current Interest Period for such
Loans be converted into Reference Rate Loans.
4.02 Additional Interest on Eurodollar Loans. The Company shall pay
---------------------------------------
to each Lender, on demand of such Lender, as long as such Lender shall be
required under regulations of the Federal Reserve Board to maintain reserves
with respect to liabilities or assets consisting of or including Eurocurrency
Liabilities, additional interest on the unpaid principal amount of each
-25-
<PAGE>
Eurodollar Loan of such Lender from the date such Eurodollar Loan is made until
such principal amount is paid in full, at a rate per annum equal at all times to
the remainder obtained by subtracting (i) LIBOR for the Interest Period for such
Eurodollar Loan from (ii) the rate obtained by dividing such LIBOR by a
percentage equal to 100% minus the Eurodollar Reserve Percentage of such Lender
for such Interest Period, payable on each Interest Payment Date for such
Eurodollar Loan.
4.03 Increased Costs. If, due to either (a) the introduction of or
---------------
any change (other than any change by way of imposition of or increase in reserve
requirements covered by Section 4.02) in or in the interpretation of any law or
------------
regulation after the date hereof (except to the extent such introduction, change
or interpretation affects Taxes or Other Taxes) or (b) the compliance with any
guideline or request issued after the date hereof (except to the extent such
guideline or request affects Taxes or Other Taxes) from any central bank or
other Governmental Authority (whether or not having the force of law), there
shall be any increase in the cost to any Lender of agreeing to make or making,
funding or maintaining any Eurodollar Loans, then the Company shall, subject to
Section 4.08(b), be liable for, and shall from time to time, upon demand
- ---------------
therefor by such Lender to the Company through the Agent, pay to the Agent for
the account of such Lender, additional amounts as are sufficient to compensate
such Lender for such increased costs. For purposes of this Section 4.03, the
------------
term "Taxes" shall have the meaning specified in Section 3.05(a) without regard
----- ---------------
to the exclusions set forth in Section 3.05(a).
---------------
4.04 Illegality. Notwithstanding any other provision of this
----------
Agreement, if the introduction of or any change in or in the interpretation of
any law or regulation shall, after the date hereof, make it unlawful, or any
central bank or other Governmental Authority shall assert that it is unlawful,
for any Lender or its Lending Office to make or continue Loans as Eurodollar
Loans or to convert Reference Rate Loans into Eurodollar Loans, then, on notice
thereof and demand therefor by such Lender to the Company through the Agent, (a)
the obligation of such Lender to make or to continue Loans as Eurodollar Loans
or to convert Reference Rate Loans into Eurodollar Loans shall terminate and (b)
the Company shall forthwith prepay in full all Eurodollar Loans of such Lender
then outstanding, together with interest accrued thereon, either on the last day
of the then current Interest Period applicable to each such Eurodollar Loan if
such Lender may lawfully continue to maintain such Eurodollar Loan to such day,
or immediately if such Lender may not lawfully continue to maintain such
Eurodollar Loan to such day, unless the Company, on or prior to the date on
which it would otherwise be required to prepay such Eurodollar Loan, converts
all Eurodollar Loans of all Lenders then outstanding into Reference Rate Loans.
4.05 Capital Adequacy. In the event that any Lender shall determine
----------------
that the compliance with any law, rule or regulation regarding capital adequacy,
or any change therein or in the interpretation or application thereof or
compliance by such Lender (or its Lending Office) or any corporation controlling
such Lender with any request or directive regarding capital adequacy (whether or
not having the force of law) from any central bank or other Governmental
Authority, affects or would affect the amount of capital required or expected to
be maintained by such Lender or any corporation controlling such Lender and such
Lender (taking into consideration such Lender's or such corporation's policies
with respect to capital adequacy and such Lender's or such corporation's desired
return on capital) determines that the amount of such capital is increased as a
consequence of such Lender's obligation under this Agreement, then the Company
shall, subject to Section 4.08(b), be liable for and shall from time to time,
---------------
upon demand therefor by such Lender through the Agent, pay to the Agent
-26-
<PAGE>
for the account of such Lender such additional amounts as are sufficient to
compensate such Lender for such increase.
4.06 Funding Losses. (a) If the Company makes any payment or
--------------
prepayment of principal with respect to any Eurodollar Loan (including payments
made after any acceleration thereof) or converts any Loan from a Eurodollar Loan
to a Reference Rate Loan on any day other than the last day of an Interest
Period applicable thereto, the Company shall pay to each Lender, upon demand
therefor by such Lender, the amount (if any) by which (i) the present value of
the additional interest which would have been payable on the amount so received
had it not been received until the last day of such Interest Period exceeds (ii)
the present value of the interest which would have been recoverable by such
Lender by placing such amount so received on deposit in the London interbank
market for a period starting on the date on which it was so received and ending
on the last day of such Interest Period. For purposes of determining present
value under this Section 4.06(a), interest amounts shall be discounted at a rate
---------------
equal to the sum of (A) LIBOR determined two Business Days before the date on
which such principal amount is received for an amount substantially equal to the
amount received and for a period commencing on the date of such receipt and
ending on the last day of the relevant Interest Period, plus (B) the percentage
above LIBOR payable in respect of such Eurodollar Loan pursuant to Section
-------
2.08(a)(ii).
- -----------
(b) If the Company fails to prepay, borrow, convert or continue any
Eurodollar Loan after a notice of prepayment, borrowing, conversion or
continuation has been given (or is deemed to have been given) to any Lender, the
Company shall reimburse each Lender, upon demand therefor by such Lender, for
any resulting loss and expense incurred by it, including any loss incurred by
reason of the liquidation or reemployment of deposits or other funds acquired by
such Lender from third parties to fund any Eurodollar Loan
4.07 Funding; Certificates of Lenders. (a) Each Lender may fulfill
--------------------------------
its obligation to make, continue or convert Loans into Eurodollar Loans by
causing one of its foreign branches or Affiliates (or an international banking
facility created by such Lender) to make or maintain such Eurodollar Loans;
provided, however, that such Eurodollar Loans shall in such event be deemed to
- -----------------
have been made and to be held by such Lender and the obligation of the Company
to repay such Eurodollar Loans shall be to such Lender for the account of such
foreign branch, Affiliate or international banking facility. In addition, the
Company hereby consents and agrees that, for purposes of any determination to be
made pursuant to Section 4.01, 4.02, 4.03, 4.04 or 4,06, it shall be
------------------------------ ----
conclusively assumed that each Lender elected to fund all Eurodollar Loans by
purchasing dollar deposits in the interbank eurodollar market for its Eurodollar
Lending Office.
(b) Any Lender claiming reimbursement or compensation pursuant to
Sections 3.05, 4.02, 4.03, 4.05 and/or 4.06 shall deliver to the Company through
- ------------------------------- ----
the Agent a certificate setting forth in reasonable detail the basis for
computing the amount payable to such Lender hereunder and such certificate shall
be conclusive and binding on the Company in the absence of manifest error. The
Company shall pay to any Lender claiming compensation or reimbursement from the
Company pursuant to Section 4.02, 4.03, 4.05 or 4.06 the amount requested by
------------------------ ----
such Lender no later than five Business Days after such demand.
-27-
<PAGE>
4.08 Change of Lending Office; Limitation on Increased Costs. (a)
-------------------------------------------------------
Each Lender agrees that upon the occurrence of any event giving rise to the
operation of Section 3.05(c) or (d) or Section 4.02, 4.03, 4.04 or 4.05 with
--------------- --- ------------------------ ----
respect to such Lender, it will use commercially reasonable efforts (consistent
with its internal policy and legal and regulatory restrictions) to minimize the
imposition of any costs and expenses pursuant to such Sections and to designate
a different Lending Office for any Loans affected by such event with the object
of avoiding the consequence of the event giving rise to the operation of such
Section. Nothing in this Section 4.08 shall affect or postpone any of the
------------
obligations of the Company or the right of any Lender provided in Section
-------
3.05(c) or (d) or Section 4.02, 4.03, 4.04 or 4.05.
- ------- --- ------------------------ ----
(b) Notwithstanding the provisions of Section 3.05(c) and (d) and
--------------- ---
Sections 4.02, 4.03 and 4.05, the Company shall only be obligated to compensate
- ------------------- ----
any Lender for any amount arising or occurring during (i) any time or period
commencing (A) in the case of Section 3.05(c) or (d), not more than six months
--------------- ---
and (B) in the case of Section 4.02, 4.03 or 4.05, not more than three months,
------------------ ----
prior to the date on which such Lender notifies the Agent and the Company that
such Lender proposes to demand such compensation and (ii) any time or period
during which, because of the unannounced retroactive application of any statute,
regulation or other basis, such Lender could not have known that such amount
might arise or accrue.
4.09 Replacement of Lenders. The Company may from time to time for
----------------------
reasonable cause, as determined by the management of the Company, including
invocation of any provision of this Article IV by any Lender, designate one or
----------
more financial institutions (any such financial institution so designated being
herein called a "Replacement Lender") willing, in its or their sole discretion,
------------------
to purchase all of the Loans and Commitments (if not theretofore terminated) of
any one or more Lenders and each such Lender's rights hereunder, without
recourse to or warranty by, or expense to, such Lender for a purchase price
equal to the outstanding principal amount of the Loans payable to such Lender
plus any accrued but unpaid interest on such Loans and any accrued but unpaid
usage fees and facility fees in respect of such Lender's Loans and Commitment
and any other amounts payable to such Lender under this Agreement or any other
Loan Document, including any amount payable pursuant to Section 4.06 as though
------------
such Lender's Eurodollar Loans were being prepaid on the date of such purchase,
and to assume all the obligations of such Lender hereunder, and, upon such
purchase, such Lender shall no longer be a party hereto or have any rights
hereunder and shall be relieved from all obligations to the Company hereunder,
and the Replacement Lender shall succeed to the rights and obligations of such
Lender hereunder.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
------------------------------
In order to induce the Lenders and the Agent to enter into this
Agreement and to induce the Lenders to extend their Commitments and to make
Loans, the Company represents and warrants to the Lenders and the Agent as of
the Closing Date (but after giving effect to the consummation of the Tender
Offer on such date and the incurrence of any Loans on such date) and as of each
Borrowing Date as follows (except for representations and warranties relating
solely to a particular point in time, which shall be correct at such point in
time):
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<PAGE>
5.01 Corporate Existence; Compliance with Law. The Company and each
----------------------------------------
Restricted Subsidiary:
(a) is a corporation duly incorporated, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) is duly qualified as a foreign corporation and in good standing
under the laws of each jurisdiction in which the character of the
properties owned or held under lease by it or the nature of the business
transacted by it requires such qualification except where the failure to be
so qualified is not likely to have a Material Adverse Effect;
(c) has all requisite corporate power and authority to own, pledge,
mortgage, hold under lease and operate its properties and to conduct its
business as now or currently proposed to be conducted; and
(d) is in compliance with all Requirements of Law applicable to it
and its business except for such non-compliance which is not likely to have
a Material Adverse Effect.
5.02 Corporate Power; Authorization. The execution, delivery and
------------------------------
performance by each Loan Party of the Transaction Documents to which such Loan
Party is a party:
(a) are within the respective corporate powers of such Loan Party;
(b) have been, or prior to such execution will have been, duly
authorized by all necessary corporate action, including the consent of
shareholders where required;
(c) do not:
(i) contravene the articles or certificate of incorporation or by-
laws of such Loan Party;
(ii) violate any other Requirement of Law;
(iii) conflict with or result in the breach of, or constitute a
default under, any Contractual Obligation of such Loan Party, except for
such conflicts, breaches or defaults which are not likely to have a
Material Adverse Effect and which do not subject any Lender or the Agent to
any criminal liability or any material civil liability; or
(iv) result in the creation or imposition of any Lien upon any of the
property of any Loan Party; and
(d) do not require the consent of, authorization by, approval of or
notice to, or filing or registration with, any Governmental Authority or
any other Person other than (i) as of the Closing Date, those which have
been obtained, made or given and which are fully disclosed in Schedule
--------
5.02(d) and (ii) those which are not required to be obtained, made or given
-------
as of the Closing Date but which will be obtained, made or given as and
when required.
-29-
<PAGE>
5.03 Enforceable Obligations. This Agreement and each other
-----------------------
Transaction Document to which any Loan Party is a party have been duly executed
and delivered by such Loan Party. This Agreement is, and each other Transaction
Document when delivered hereunder will be, legal, valid and binding obligations
of each Loan Party, a party thereto, enforceable against each such Loan Party in
accordance with their respective terms except as such enforcement may be limited
by applicable bankruptcy, insolvency, reorganization or other similar laws
relating to or limiting creditors' rights generally.
5.04 Taxes. As of the Closing Date, the Company and each Restricted
-----
Subsidiary have filed all federal, state, local and foreign tax returns which
are required to have been filed in any jurisdiction and have paid all taxes
shown to be due thereon or otherwise assessed, to the extent the same have
become due and payable and before they have become delinquent, except for any
taxes and assessments the amount, applicability or validity of which is
currently being contested in good faith by appropriate proceedings and with
respect to which the Company has set aside on its books reserves (adequate in
accordance with, and segregated to the extent required by, GAAP) and the non-
filing or non-payment of which is not likely to have a Material Adverse Effect.
5.05 Financial Matters. (a) (i) The consolidated balance sheets of
-----------------
the Company and its Subsidiaries as of the last day of the fiscal year ended on
December 31, 1998 and as of the last day of the fiscal quarter ended on April 3,
1999, and (in either case) the related consolidated statements of income and
cash flows of the Company and its Subsidiaries for such fiscal year or fiscal
quarter, as the case may be, together (in the case of the fiscal year end
financial statements) with reports thereon by Arthur Andersen & Co., independent
public accountants, copies of which have been delivered to the Agent and each
Lender prior to the execution of this Agreement, fairly present the consolidated
financial position of the Company and its Subsidiaries as of the date of said
balance sheets and the consolidated results of their operations for the periods
covered by said statements of income and cash flows, and have been prepared in
accordance with GAAP consistently applied in all material respects by the
Company and its Subsidiaries throughout the periods involved, except (x) in the
case of the fiscal year end financial statements, as set forth in the notes
thereto and (y) in the case of the three-month interim financial statements, for
normal year-end audit adjustments and the absence of footnotes. There are no
material liabilities, contingent or otherwise, of the Company or any Subsidiary
of the Company not reflected in the consolidated balance sheets as of December
31, 1998 and as of April 3, 1999 or in the notes thereto which are required to
be disclosed therein.
(ii) The consolidated balance sheets of Unisource and its
Subsidiaries as of the last day of the fiscal year ended on September 30, 1998
and as of the last day of the fiscal quarter ended on March 31, 1999, and (in
either case) the related consolidated statements of income and cash flows of
Unisource and its Subsidiaries for such fiscal year or fiscal quarter, as the
case may be, together (in the case of the fiscal year end financial statements)
with reports thereon by Ernst & Young LLP, independent public accountants,
copies of which have been delivered to the Agent and each Lender prior to the
execution of this Agreement, fairly present the consolidated financial position
of Unisource and its Subsidiaries as of the date of said balance sheets and the
consolidated results of their operations for the periods covered by said
statements of income and cash flows, and have been prepared in accordance with
GAAP consistently applied in all material respects by Unisource and its
Subsidiaries throughout the periods involved, except (x) in the case of the
fiscal year end financial statements, as set forth in the notes thereto and (y)
in the case of the six-month interim financial
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<PAGE>
statements, for normal year-end audit adjustments and the absence of footnotes.
There are no material liabilities, contingent or otherwise, of Unisource or any
Subsidiary of Unisource not reflected in the consolidated balance sheet as of
September 30, 1998 and as of March 31, 1999 or in the notes thereto which are
required to be disclosed therein.
(b) Since December 31, 1998 (or, in the case of Unisource, since
September 30, 1998), there has been no Material Adverse Effect and no
development which is likely to have a Material Adverse Effect, except as
reflected in the Company's or Unisource's periodic reports filed with the
Securities and Exchange Commission prior to the Closing Date.
(c) There is no material obligation, contingent liability or
liability for taxes, long-term leases or unusual forward or long-term
commitments which is not reflected in the April 3, 1999 consolidated financial
statements of the Company and its Subsidiaries or in the March 31, 1999
consolidated financial statements of Unisource and its Subsidiaries which (in
either case) are required by GAAP to be disclosed therein and no liability which
would be required to be reflected in the notes to such financial statements if
same were audited is likely to have a Material Adverse Effect.
5.06 Litigation. There are no pending or, to the knowledge of the
----------
Company, threatened, actions or proceedings affecting the Company or any
Restricted Subsidiary before any court or other Governmental Authority or any
arbitrator that are likely to have a Material Adverse Effect.
5.07 Subsidiaries. (a) A complete and correct list of the Company's
------------
Subsidiaries as of the Closing Date, showing, as to each such Subsidiary, the
correct name thereof, the jurisdiction of its incorporation and the percentage
of shares of each class of its securities outstanding owned by the Company and
each other Subsidiary of the Company, is set forth in Schedule 5.07.
-------------
(b) (i) All of the outstanding shares of securities of each of the
Subsidiaries of the Company listed in Schedule 5.07 have been validly issued,
-------------
are fully paid and nonassessable and are owned by the Company or another
Subsidiary of the Company, free and clear of any Lien, except as otherwise
permitted hereunder, and (ii) no Subsidiary of the Company owns any shares of
securities of the Company.
5.08 Liens. As of the Closing Date, there are no Liens of any nature
-----
whatsoever on any properties owned by the Company or any Restricted Subsidiary
other than Permitted Liens.
5.09 No Burdensome Restrictions; No Defaults. (a) Neither the Company
---------------------------------------
nor any Restricted Subsidiary is a party to any Contractual Obligation the
performance of which is likely to have a Material Adverse Effect.
(b) As of the Closing Date, no provision or provisions of any
applicable Requirement of Law has or is likely to have a Material Adverse
Effect.
(c) Neither the Company nor any Restricted Subsidiary is in
default under or with respect to any Contractual Obligation which default is
likely to have a Material Adverse Effect.
(d) No Default or Event of Default has occurred and is continuing.
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5.10 Investment Company Act; Public Utility Holding Company Act. No
----------------------------------------------------------
Loan Party is an "investment company" or an "affiliated person" of, or
"promoter" or "principal underwriter" for, an "investment company", as such
terms are defined in the Investment Company Act of 1940, as amended, or a
"holding company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a n subsidiary company n of a n holding
company", within the meaning of the Public Utility Holding Company Act of 1935,
as amended. The making of the Loans by the Lenders, the application of the
proceeds and repayment thereof by the Company and the consummation of the
transactions contemplated by the Loan Documents will not violate any provision
applicable to any Loan Party of (a) the Investment Company Act of 1940, as
amended, or (b) any rule, regulation or order issued by the Securities and
Exchange Commission thereunder.
5.11 Margin Regulations. The proceeds of the Loans will be used
------------------
solely to finance the Acquisition, to refinance certain existing Indebtedness of
Unisource and its Subsidiaries and to pay the fees and expenses incurred in
connection with the Transaction. No part of the proceeds of any Loan will be
used in violation of Regulation T, U or X of the Federal Reserve Board. After
giving effect to the application of the proceeds of the Loans less than twenty-
five percent (25%) of the assets of the Company, individually and on a
consolidated basis with its Subsidiaries, consists of margin stock. The Company
is not engaged principally, or as one of its important activities, in the
business of extending credit for the purpose of purchasing or carrying margin
stock. Terms for which meanings are provided in Regulation U of the Federal
Reserve Board or any regulations substituted therefor, as from time to time in
effect, are used in this Section 5.11 with such meanings.
------------
5.12 Environmental Matters. As of the Closing Date, except as set
---------------------
forth in Schedule 5.12:
-------------
(a) all facilities and property (including underlying groundwater)
presently owned or leased by the Company or any of its Subsidiaries have
been, and continue to be, owned or leased by the Company and its
Subsidiaries in material compliance with all Environmental Laws, except for
such non-compliance as is not likely to have a Material Adverse Effect;
(b) there are no pending or threatened
(i) claims, complaints, notices or requests for information received
by the Company or any of its Subsidiaries with respect to any alleged
violation of any Environmental Law which are likely to have a Material
Adverse Effect, or
(ii) claims, complaints, notices or inquiries to the Company or any
of its Subsidiaries regarding potential liability under any Environmental
Law which are likely to have a Material Adverse Effect;
(c) except for Releases of Hazardous Materials which occurred after
the date that the Company or any of its Subsidiaries sold, transferred,
assigned or otherwise disposed of its interests in any previously owned or
leased property, there have been no Releases of Hazardous Materials at, on
or under any property now or previously owned or leased by the Company or
any of its Subsidiaries that are likely to have a Material Adverse Effect;
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<PAGE>
(d) the Company and its Subsidiaries have been issued and are in
material compliance with all permits, certificates, approvals, licenses and
other authorizations relating to environmental matters and necessary or
desirable for their businesses except for such non-compliance as is not
likely to have a Material Adverse Effect;
(e) (i) no property presently owned or leased by the Company or any
of its Subsidiaries, and (ii) to the best of the knowledge of the Company,
no property previously owned or leased by the Company or any of its
Subsidiaries, is listed or proposed for listing on the National Priorities
List pursuant to CERCLA or on any similar published state list of sites
requiring investigation or clean-up;
(f) to the knowledge of the Company, there are no underground
storage tanks, active or abandoned, including petroleum storage tanks, on
or under any property now or previously owned or leased by the Company or
any of its Subsidiaries that are likely to have a Material Adverse Effect;
(g) neither the Company nor any of its Subsidiaries has directly
transported or directly arranged for the transportation of any Hazardous
Material to any location which is listed or proposed for listing on the
National Priorities List pursuant to CERCLA, on the CERCLIS or on any
similar published state list or which is the subject of federal, state or
local enforcement actions or other investigations which may lead to claims
against the Company or such Subsidiary for any remedial work, damage to
natural resources or personal injury, including claims under CERCLA, except
for such claims which are not likely to have a Material Adverse Effect;
(h) there are no polychlorinated biphenyls or friable asbestos
present at any property now or previously owned or leased by the Company or
any of its Subsidiaries that are likely to have a Material Adverse Effect;
and
(i) to the knowledge of the Company, no conditions exist at, on or
under any property now or previously owned or leased by the Company or any
of its Subsidiaries which, with the passage of time, or the giving of
notice or both, are likely to have a Material Adverse Effect.
5.13 Labor Matters. Except as set forth in Schedule 5.13, there are
------------- -------------
no strikes or other labor disputes or grievances or charges or complaints with
respect to any employee or group of employees pending or, to the knowledge of
the Company, threatened against the Company or any Restricted Subsidiary which
are likely to have a Material Adverse Effect.
5.14 ERISA Plans. During the twelve-consecutive-month period prior
-----------
to the Closing Date, no steps have been taken to terminate any Pension Plan
(other than a standard termination as defined in Section 4041(b) of ERISA for
---------------
which a commitment to make the terminating Pension Plan sufficient is not
required), and no contribution failure has occurred with respect to any Pension
Plan sufficient to give rise to a Lien under Section 302(f) of ERISA. Other than
--------------
liability for benefit payments or contributions in the ordinary course, no
condition exists or event or transaction has occurred with respect to any Plan
which is likely to result in the incurrence by the Company or any member of the
Controlled Group of any material liability, fine or penalty. Each Plan complies
with
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<PAGE>
the applicable provisions of ERISA and the Code, except where such non-
compliance is not likely to have a Material Adverse Effect. Except as disclosed
in Schedule 5.14, neither the Company nor any Subsidiary of the Company has any
-------------
material contingent liability with respect to any post-retirement benefit under
a Welfare Plan, other than liability for continuation coverage described in Part
6 of Subtitle B of Title I of ERISA.
5.15 Transaction. At the time of consummation thereof, each component
-----------
of the Transaction shall have been (or, in the case of the Merger, will be)
consummated in all material respects in accordance with the terms of the
applicable Transaction Documents and all applicable laws. At the time of
consummation thereof, all material consents and approvals of, and filings and
registrations with, and all other actions in respect of, all governmental
agencies, authorities or instrumentalities required in order to make or
consummate each component of the Transaction shall have been (or, in the case of
the Merger, will be) obtained, given, filed or taken or waived and are or will
be in full force and effect (or effective judicial relief with respect thereto
shall have been obtained). All applicable waiting periods with respect thereto
have or, prior to the time when required, will have, expired without, in all
such cases, any action being taken by any competent authority which restrains,
prevents, or imposes material adverse conditions upon the Transaction.
Additionally, there does not exist any judgment, order or injunction prohibiting
or imposing material adverse conditions upon the Transaction, or the performance
by the Company and the other Loan Parties of their obligations under the
respective Transaction Documents to which they are a party.
ARTICLE VI
CONDITIONS PRECEDENT
--------------------
6.01 Conditions Precedent to the Closing Date. The occurrence of the
----------------------------------------
Closing Date and the obligation of each Lender to be committed to make a Loan on
the Closing Date, if any, is subject to satisfaction of the condition precedent
that the Agent shall have received the following, each, unless otherwise
specified below, dated the Closing Date, in form and substance satisfactory to
the Agent and its counsel:
(a) Execution of Agreement. This Agreement shall have been executed
----------------------
and delivered by the Company to the Agent.
(b) Board Resolutions; Incumbency Certificates. A certificate of the
------------------------------------------
Secretary or an Assistant Secretary of each Loan Party certifying (i) all
documents (including board of directors resolutions) evidencing other
necessary corporate action, if any, by each Loan Party with respect to each
Transaction Document and (ii) the names and signatures of the officers
authorized to act with respect to each Loan Document executed by it, upon
which certificate the Agent and each Lender may conclusively rely until it
shall have received a further certificate of the Secretary or Assistant
Secretary of such Loan Party cancelling or amending such prior certificate;
(c) Articles of Incorporation; By-Laws and Good Standing
----------------------------------------------------
Certificates. Each of the following documents:
-------------
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<PAGE>
(i) the articles or certificate of incorporation of each Loan Party
as in effect on the Closing Date, certified (A) by the Secretary of State
of the state of incorporation of such Loan Party as of a date reasonably
close to the Closing Date, and (B) by the Secretary or an Assistant
Secretary of such Loan Party as of the Closing Date, and the by-laws of
each Loan Party, as in effect on the Closing Date, certified by the
Secretary or an Assistant Secretary of such Loan Party as of the Closing
Date; and
(ii) a good standing certificate for each Loan Party from the
Secretary of State of the state of incorporation of such Loan Party as of a
date reasonably close to the Closing Date;
(d) Subsidiary Guaranty. A guaranty, duly executed by each Principal
-------------------
Subsidiary, in substantially the form of Exhibit 6.01(d) (as from time to
---------------
time amended, modified or supplemented, the "Subsidiary Guaranty");
-------------------
(e) Legal Opinion. A favorable opinion addressed to the Agent and
-------------
all Lenders from counsel to the Company and its Subsidiaries, in
substantially the form of Exhibit 6.01(e) (which opinion the Company and
---------------
its Subsidiaries hereby expressly instruct such counsel to prepare and
deliver); and
(f) No Material Adverse Effect. Since December 31, 1998 (or, in the
--------------------------
case of Unisource, since September 30, 1998), there shall have been no
Material Adverse Effect and no development which is likely to have a
Material Adverse Effect, except as reflected in the Company's or
Unisource's periodic reports filed with the Securities and Exchange
Commission prior to the Closing Date.
(g) Margin Regulations. All Loans made by the Lenders shall be in
------------------
full compliance with all applicable Requirements of Law, including
Regulations T, U and X of the Federal Reserve Board
(h) Fees, Costs and Expenses. The Company shall have paid all fees
------------------------
referred to in Section 3.01 to the extent then due and payable and all
------------
reasonable costs and expenses referred to in Section 11.04 (including legal
-------------
fees and expenses) and any indemnity pursuant to Section 11.05 which, in
-------------
each case, may be then due and payable.
(i) Tender Offer; Merger Agreement. (i) On or prior to the Closing
------------------------------
Date, (A) the Tender Offer shall have been consummated in all material
respects in accordance with the Tender Offer Documents and all applicable
laws, and each of the conditions precedent to the consummation of the
Tender Offer shall have been satisfied in all material respects and no
material condition thereto waived; (B) Atlanta Acquisition shall have
purchased a sufficient number of shares of common stock of Unisource
pursuant to the Tender Offer to effect the Merger without any affirmative
vote or approval of any other Person; (C) Atlanta Acquisition shall be
required on such date to pay for the shares of Unisource tendered to it
pursuant to the Tender Offer; and (D) the Merger Agreement shall have been
entered into and shall be in full force and effect.
(j) Company Officer's Certificate. The Company shall have delivered
-----------------------------
to the Agent a certificate from a Responsible Officer of the Company in
substantially the form of
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<PAGE>
Exhibit 6.01(j) as to the satisfaction of the conditions set forth in
---------------
paragraphs (f), (g), (h) and (i) of this Section 6.01 and paragraph (b) of
-------------------------------- ------------ -------------
Section 6.02.
------------
6.02 Conditions Precedent to Each Borrowing. The obligation of each
--------------------------------------
Lender to make any Loan (including its initial Loan) shall be subject to the
following additional conditions:
(a) Notice of Borrowing. The Agent shall have received a Notice of
-------------------
Borrowing as required by Section 2.02.
------------
(b) Accuracy of Representations; No Default; Etc. The following
---------------------------------------------
statements shall be true on the Closing Date and on each Borrowing Date,
before and after giving effect thereto:
(i) The representations and warranties contained in Article V are
---------
correct on and as of the closing Date and on each Borrowing Date as though
made on and as of such date (except for representations and warranties
relating solely to a particular point in time, which shall be correct as at
such point in time); and
(ii) No Default or Event of Default has occurred and is continuing or
would result from such Loans (if any) being made on such date.
(c) The Closing Date shall have occurred.
(d) Other Assurances. The Agent shall have received such other
----------------
approvals, opinions or documents as any Lender through the Agent may
reasonably request related to the transactions contemplated hereby.
ARTICLE VII
AFFIRMATIVE COVENANTS
---------------------
The Company agrees that as long as the obligations of the Lenders to
make Loans shall remain in effect and until all Obligations shall have been paid
or performed in full, unless the Required Lenders shall otherwise consent in
writing:
7.01 Application of Proceeds. The Company will apply the proceeds of
-----------------------
the Loans solely to finance the Transaction and to pay the fees and expenses
incurred in connection therewith.
7.02 Compliance with Laws, Etc. The Company will comply, and cause
--------------------------
each of its Subsidiaries to comply, in all material respects with all applicable
Requirements of Law except for such non-compliance as is being contested in good
faith by appropriate proceedings or is not likely to have a Material Adverse
Effect.
7.03 Payment of Taxes, Etc. The Company will pay and discharge, and
---------------------
cause each of its Subsidiaries to pay and discharge, before the same shall
become delinquent, all lawful claims and all taxes, assessments and governmental
charges or levies except where contested in good faith, by proper proceedings,
if adequate reserves therefor have been established on the books of the Company
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<PAGE>
in accordance with, and to the extent required by, GAAP, or if such non-payment
(individually and in the aggregate with all other such non-payments) is not
likely to have a Material Adverse Effect.
7.04 Maintenance of Insurance. The Company will maintain, and cause
------------------------
each of its Subsidiaries to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such risks as
is usually carried by companies engaged in similar businesses and owning similar
properties in the same general areas in which the Company and such Subsidiaries
operate; provided, however, that the Company and its Subsidiaries may self-
-------- -------
insure to the extent that the Company or any such Subsidiary may in its
discretion determine; and provided, further, that the Company may maintain
-------- -------
insurance on behalf of any of its Subsidiaries. Without limiting the generality
of the foregoing, the Company will, and will cause each of its Subsidiaries to,
maintain insurance coverages that are at least substantially the same as the
insurance coverages maintained on the Closing Date.
7.05 Preservation of Corporate Existence, Etc. The Company will
----------------------------------------
preserve and maintain, and cause each Restricted Subsidiary to preserve and
maintain, its corporate existence, rights (charter and statutory), and
franchises, except as permitted under Section 8.03 or except to the extent that
------------
the failure by the Company or any such Restricted Subsidiary to comply with the
foregoing is not likely to have a Material Adverse Effect.
7.06 Access. The Company will from time to time, during normal
------
business hours upon reasonable notice, or, if a Default or an Event of Default
shall have occurred and be continuing, at any time upon notice to an officer of
the Company having at least the rank of Vice President, permit the Agent, any
Lender and any agent or representative thereof, to examine and make copies of
and abstracts from the records and books of account of, and visit the properties
of, the Company and any of its Subsidiaries, and to discuss the affairs,
finances and accounts of the Company and any of its Subsidiaries with any of
their respective officers.
7.07 Keeping of Books. The Company will keep proper books of record
----------------
and account, in which full and correct entries, on a consolidated basis for the
Company and its Subsidiaries, shall be made of all financial transactions and
the assets and business of the Company and its Subsidiaries in accordance with
GAAP consistently applied.
7.08 Maintenance of Properties, Etc. The Company will maintain and
------------------------------
preserve, and cause each of its Subsidiaries to maintain and preserve, all of
its properties in good repair, working order and condition, and from time to
time make or cause to be made all necessary and proper repairs, renewals,
replacements and improvements so that the business carried on in connection
therewith may be properly and advantageously conducted at all times; provided,
--------
however, that nothing in this Section 7.08 shall prevent the Company or any of
- ------- ------------
its Subsidiaries from discontinuing the maintenance or preservation of any of
its properties if such discontinuance is, in the opinion of the Company,
desirable in the conduct of its business and is not likely to have a Material
Adverse Effect.
7.09 Financial Statements. The Company will furnish to the Agent,
--------------------
with sufficient copies for the Lenders:
(a) as soon as available and in any event within 45 days after the
end of each of the first three quarters of each fiscal year of the Company,
consolidated balance sheets of the
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<PAGE>
Company and its Subsidiaries as of the end of such quarter and the related
statements of income and cash flows for such quarter and for the period
commencing at the end of the previous fiscal year and ending with the end
of such quarter;
(b) as soon as available and in any event within 90 days after the
end of each fiscal year of the Company, audited consolidated balance sheets
of the Company and its Subsidiaries as of the end of such year and the
related consolidated statements of income, changes in shareholders' equity
and cash flows for the period commencing at the end of the previous fiscal
year and ending with the end of such year; and
(c) at the same time it furnishes each set of financial statements
pursuant to paragraphs (a) and (b) above, (i) a certificate of a
-------------- ---
Responsible Officer of the Company to the effect that no Default or Event
of Default has occurred and is continuing (or if any Default or Event of
Default has occurred and is continuing, describing the same in reasonable
detail and the action which the Company proposes to take with respect
thereto) and (ii) a compliance certificate in substantially the form of
Exhibit 7.09.
------------
7.10 Reporting Requirements. The Company will furnish to the Agent,
----------------------
with sufficient copies for the Lenders:
(a) promptly and in any event within three Business Days after the
Company becomes aware of the existence of any Default or Event of Default,
notice by telephone or facsimile specifying the nature of such Default or
Event of Default, which notice, if given by telephone, shall be promptly
confirmed in writing within five Business Days;
(b) promptly after the sending or filing thereof, copies of all
reports which the Company sends to its security holders generally and
copies of all reports and registration statements which the Company or any
of its Subsidiaries files with the Securities and Exchange Commission or
any national securities exchange (including the Company's Quarterly Report
on Form 10-Q and Annual Report on Form 10-K);
(c) promptly but not later than three Business Days after the
Company becomes aware of any change by Moody's or S&P in its Debt Rating,
notice by telephone or facsimile of such change; and
(d) such other information respecting the business, prospects,
properties, operations or condition, financial or otherwise of the Company
or any of its Subsidiaries as any Lender through the Agent may from time to
time reasonably request.
7.11 ERISA Plans. The Company will maintain and operate, and cause
-----------
each Subsidiary to maintain and operate, each Plan in material compliance with
ERISA and the Code and all applicable regulations thereunder.
7.12 Environmental Compliance; Notice. The Company will, and will
--------------------------------
cause each of its Subsidiaries to:
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<PAGE>
(a) endeavor to use and operate all of its facilities and properties
in substantial compliance with all Environmental Laws, keep all necessary
permits, approvals, certificates, licenses and other authorizations
relating to environmental matters in effect and remain in substantial
compliance therewith, and handle all Hazardous Materials in substantial
compliance with all applicable Environmental Laws;
(b) promptly upon receipt of all written claims, complaints, notices
or inquiries relating to the condition of its facilities and properties or
compliance with Environmental Laws, evaluate such claims, complaints,
notices and inquiries and forward copies of (i) all such claims,
complaints, notices and inquiries which individually are likely to have a
Material Adverse Effect and (ii) all such claims, complaints, notices and
inquiries, arising from a single occurrence which together are likely to
have a Material Adverse Effect, and endeavor to promptly resolve all such
actions and proceedings relating to compliance with Environmental Laws; and
(c) provide such information and certifications which the Agent may
reasonably request from time to time to evidence compliance with this
Section 7.12.
------------
7.13 The Merger. (a) As soon as practicable following the Closing
----------
Date, but no later than October 15, 1999, the Company will cause the Merger to
be consummated in accordance with the terms of the Merger Documents and all
applicable laws.
(b) Within five days after the consummation of the Merger, the
Company will cause Unisource, as the surviving corporation of the Merger, to
deliver a letter to the Agent acknowledging that it has assumed all of the
liabilities and obligations of Atlanta Acquisition under the Subsidiary Guaranty
by virtue of the Merger.
ARTICLE VIII
NEGATIVE COVENANTS
------------------
The Company agrees that as long as the obligations of the Lenders to
make Loans shall remain in effect and until all Obligations shall have been paid
or performed in full, unless the Required Lenders shall otherwise consent in
writing:
8.01 Liens, Etc. The Company shall not create or assume and shall
----------
not permit any Restricted Subsidiary to create or assume, any Lien upon or with
respect to any of its Principal Properties or shares of capital stock or
Indebtedness of any Restricted Subsidiary, whether now owned or hereafter
acquired, without making effective provision, and the Company in such case will
make or cause to be made effective provision, whereby the Obligations shall be
secured by such Lien equally and ratably with any and all other Indebtedness or
obligations thereby secured, so long as such other Indebtedness or obligations
shall be so secured; provided, however, that the foregoing shall not apply to
-------- -------
any of the following:
(a) Liens existing on the Closing Date and set forth in Schedule
--------
8.01, it being understood and agreed however, that those existing Liens in
- ----
respect of the assets of Unisource and its Subsidiaries that are set forth in
such Schedule 8.01 and designated as being required
-------------
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<PAGE>
to be terminated shall only be permitted until the date which is 30 days
after the earlier of (i) the date on which the Company and/or Unisource
repays the underlying Indebtedness as part of the Transaction and (ii) the
date on which the Merger is consummated;
(b) Liens on any Principal Property acquired, constructed or improved
after the date of this Agreement which are created or assumed
contemporaneously with, or within 120 days after, or pursuant to financing
arrangements for which a firm commitment is made by a bank, insurance
company or other lender or investor (not including the Company or any
Restricted Subsidiary) within 120 days after, the completion of such
acquisition, construction or improvement to secure or provide for the
payment of any part of the purchase price of such property or the cost of
such construction or improvement, or, in addition to Liens contemplated by
paragraphs (c) and (d) below, Liens on any Principal Property existing at
-------------- ---
the time of acquisition thereof; provided, however, that in the case of any
-------- -------
such acquisition, construction or improvement the Lien shall not apply to
any property theretofore owned by the Company and/or one or more Restricted
Subsidiaries other than, in the case of such construction or improvement,
any theretofore unimproved real property on which the property so
constructed, or the improvement, is located;
(c) Liens on property or shares of capital stock or indebtedness of a
corporation existing at the time such corporation is merged into or
consolidated with the Company or a Restricted Subsidiary or existing at the
time of a sale, lease or other disposition of the properties of a
corporation as an entirety or substantially as an entirety to the Company
or to a Restricted Subsidiary;
(d) Liens on property or shares of capital stock of a corporation
existing at the time such corporation becomes a Restricted Subsidiary;
(e) Liens to secure Indebtedness of a Restricted Subsidiary to the
Company or one or more Subsidiaries;
(f) Liens in favor of the United States of America or any State
thereof, or any department, agency or political subdivision of the United
States of America or any State thereof, to secure partial, progress,
advance or other payments pursuant to any contract or statute or to secure
any Indebtedness incurred for the purpose of financing all or any part of
the purchase price or the cost of constructing or improving the property
subject to such Liens;
(g) Liens on timberlands in connection with an arrangement under
which the Company and/or one or more Restricted Subsidiaries are obligated
to cut or pay for timber in order to provide the lienholder with a
specified amount of money, however determined;
(h) Liens created or assumed in the ordinary course of the business
of exploring for, developing or producing oil, gas or other minerals
(including in connection with borrowings of money for such purposes) on, or
on any interest in, or on any proceeds from the sale of, property acquired
or held for the purpose of exploring for, developing or producing oil, gas
or other minerals, or production therefrom, or proceeds of such production,
or material or equipment located on such property;
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<PAGE>
(i) Liens in favor of any customer arising in respect of performance
deposits and partial, progress, advance or other payments made by or on
behalf of such customer for goods produced or to be produced or for
services rendered or to be rendered to such customer in the ordinary course
of business, which Liens shall not exceed the amount of such deposits or
payments;
(j) Liens on the property of the Company or any Restricted Subsidiary
incurred or pledges and deposits made in the ordinary course of business in
connection with worker's compensation, unemployment insurance, old-age
pensions and other social security benefits other than in respect of
employer plans subject to ERISA;
(k) Liens pertaining to receivables or other accounts sold by the
Company or any of its Subsidiaries pursuant to a receivables sale
transaction in favor of the purchaser or purchasers of such receivables or
other accounts;
(l) purchase money liens or purchase money security interests upon or
in any other property acquired by the Company or any Restricted Subsidiary
in the ordinary course of business to secure the purchase price of such
property or to secure Indebtedness incurred solely for the purpose of
financing the acquisition of such property;
(m) extensions, renewals and replacements of Liens referred to in
paragraphs (a) through (l) above or this paragraph (m), provided, however,
-------------- --- -------------- -----------------
that the Indebtedness secured thereby shall not exceed the principal amount
of the Indebtedness so secured at the time of such extension, renewal or
replacement, and such extension, renewal or replacement shall be limited to
all or part of the property or assets which secured the Lien extended,
renewed or replaced (plus improvements on such property);
(n) Liens imposed by law, such as workers', materialmen's,
mechanics', warehousemen's, carriers', lessors', vendors' and other similar
Liens incurred by the Company or any Restricted Subsidiary arising in the
ordinary course of business which secure its obligations to any Person;
(o) Liens created by or resulting from any litigation or proceedings
which are being contested in good faith by appropriate proceedings; Liens
arising out of judgments or awards against the Company and/or one or more
Restricted Subsidiaries with respect to which the Company and/or such
Restricted Subsidiary or Subsidiaries are in good faith prosecuting an
appeal or proceedings for review; or Liens incurred by the Company and/or
one or more Restricted Subsidiaries for the purpose of obtaining a stay or
discharge in the course of any legal proceeding to which the Company and/or
such Restricted Subsidiary or Subsidiaries are a party;
(p) Liens for taxes, assessments or other governmental charges or
levies, either not yet due and payable or to the extent that non-payment
thereof shall be permitted by Section 7.03, landlord's liens on property
------------
held under lease and tenants' rights under leases;
(q) zoning restrictions, easements, licenses, reservations,
restrictions on the use of real property or minor irregularities of title
incident thereto which do not materially impair the
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<PAGE>
value of any parcel of property material to the operation of the business
of the Company and its Subsidiaries taken as a whole or the value of such
property for the purpose of such business; and
(r) Liens arising in connection with Sale-Leaseback Transactions
permitted by Section 8.02.
------------
8.02 Sale-Leaseback Transactions. The Company shall not, and shall
---------------------------
not permit any Restricted Subsidiary to, enter into any arrangement with any
Person providing for the leasing by the Company and/or one or more Restricted
Subsidiaries of any Principal Property (except for temporary leases for a term,
including any renewal thereof, of not more than three years and except for
leases between the Company and one or more Restricted Subsidiaries or between
Restricted Subsidiaries) which property has been or is to be sold or transferred
by the Company and/or such Restricted Subsidiary or Subsidiaries to such Person
(a "Sale-Leaseback Transaction") unless (a) the Company and/or such Restricted
--------------------------
Subsidiary or Subsidiaries would be entitled to incur Indebtedness secured by a
Lien on such property without equally and ratably securing the Obligations
pursuant to the provisions of Section 8.01, or (b) the Company shall apply or
------------
cause to be applied an amount equal to the Value of such Sale-Leaseback
Transaction within 120 days of the effective date of any arrangement (i) to the
retirement of Indebtedness for Borrowed Money incurred or assumed by the Company
or any Restricted Subsidiary (other than indebtedness for borrowed money owed to
the Company and/or one or more Restricted Subsidiaries) which by its terms
matures on, or is extendable or renewable at the option of the obligor to, a
date more than 12 months after the date of the incurrence or assumption of such
indebtedness and which is senior in right of payment to, or ranks pari passu
---- -----
with, the Loans, or (ii) to the purchase of other property which will constitute
"Principal Property" having a fair value in the opinion of the Board of
Directors of the Company at least equal to the Value of such Sale-Leaseback
Transaction, or (c) the Company shall use the net proceeds to repay Loans
hereunder and if all of the Loans have been repaid in full, to reduce the
Aggregate Commitments hereunder.
Notwithstanding the provisions of Sections 8.01 and 8.02, the Company
------------- ----
and any one or more of its Restricted Subsidiaries may nevertheless create or
assume Liens which would otherwise require securing of the Obligations under
said provisions, and enter into Sale-Leaseback Transactions without compliance
with either paragraph (b) or (c) of this Section 8.02, provided that the
------------- --- ------------ --------
aggregate amount of all such Liens and Sale-Leaseback Transactions permitted by
this Section 8.02 at any time outstanding (as measured by the sum of (a) all
------------
Indebtedness secured by all such Liens then outstanding or to be so created or
assumed, but excluding secured Indebtedness permitted under the exceptions in
Section 8.01, and (b) the Value of all such Sale-Leaseback Transactions then
- ------------
outstanding or to be so entered into, but excluding such transactions in which
indebtedness is retired or property is purchased or Loans are repaid) shall not
exceed 10% of Net Tangible Assets.
8.03 Mergers, Etc. The Company shall not merge or consolidate with
------------
or into, or convey, transfer, lease or otherwise dispose of (whether in one
transaction or in a series of transactions) all or substantially all of its
assets, whether now owned or hereafter acquired, to any Person; provided,
--------
however, that the Company may merge or consolidate with or into any corporation
- -------
(whether or not affiliated with the Company) or convey, transfer, lease or
otherwise dispose of all or substantially all of its assets, to any other
corporation (whether or not affiliated with the Company)
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authorized to acquire or operate the same, so long as (a) in the case of such
merger or consolidation, the Company is the surviving corporation or (b) if
either (i) in the case of such merger or consolidation, if the Company is not
the surviving corporation, or (ii) upon any such conveyance, transfer, lease or
other disposition, the surviving or transferee corporation expressly assumes the
due and punctual payment of all Obligations according to their terms and the due
and punctual performance and observance of all of the covenants and conditions
of this Agreement to be performed by the Company.
8.04 Transactions with Affiliates. The Company shall not enter into
----------------------------
or be a party to, or permit any of its Subsidiaries to enter into or be a party
to, any transaction with any Affiliate of the Company except (i) as may be
permitted under Sections 8.01, 8.02 or 8.03 or (ii) transactions in the ordinary
------------------- ----
course of business which are not likely to have a Material Adverse Effect.
8.05 Accounting Changes. The Company (a) shall not make, or permit
------------------
any of its Subsidiaries to make, any significant change in accounting treatment
and reporting practices except as permitted or required by GAAP or the
Securities and Exchange Commission and (b) shall not designate a different
fiscal year than the fiscal year used in the preparation of the financial
statements referred to in Section 5.05(a).
---------------
8.06 Margin Regulations. The Company shall not use the proceeds of
------------------
any Loan in violation of Regulation T, U or X of the Board of Governors of the
Federal Reserve System.
8.07 Negative Pledges, Etc. The Company shall not, and shall not
---------------------
permit any Restricted Subsidiary to, enter into any agreement prohibiting
compliance by the Company with the provisions of the introduction to Section
-------
8.01 or restricting the ability of the Company or any other Loan Party to amend
- ----
or otherwise modify this Agreement or any other Loan Document.
8.08 Leverage Ratio. The Company shall not permit the ratio of (a)
--------------
Funded Indebtedness on the last day of any fiscal quarter to (b) Operating Cash
Flow for the Measurement Period ending on such date (in each case calculated on
a consolidated basis for the Company and its consolidated Subsidiaries and
assuming for this purpose that the Company acquired Unisource on July 1, 1998)
to be greater than 4.50 to 1.00.
ARTICLE IX
EVENTS OF DEFAULT
-----------------
9.01 Events of Default. The term "Event of Default" shall mean any
----------------- ----------------
of the events set forth in this Section 9.01.
------------
(a) Non-Payment. The Company shall (i) fail to pay any principal
-----------
of any Loan when the same shall become due and payable; or (ii) fail to pay any
interest on any Loan or fail to pay any fee due under this Agreement within
three Business Days after the same shall become due and payable;
(b) Representations and Warranties. Any representation or warranty
------------------------------
made by the Company in this Agreement or by any Loan Party in any other Loan
Document or in any certificate,
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<PAGE>
document or financial or other statement delivered at any time under or in
connection with this Agreement or any other Loan Document shall prove to have
been incorrect or untrue in any material respect when made or deemed made;
(c) Specific Defaults. The Company shall fail to perform or
-----------------
observe any term, covenant or agreement contained in Section 7.01, 7.05, 7.06,
------------ ---- ----
7.10(a) or 7.13 or Article VIII;
- ------- ---- ------------
(d) Other Defaults. The Company shall fail to perform or observe
--------------
any other term or covenant contained in this Agreement or any Loan Party shall
fail to perform any other term or covenant in any other Loan Document, and such
Default shall continue unremedied for a period of 30 days after the date upon
which written notice thereof shall have been given to the Company by the Agent;
(e) Default under Other Agreements. Any default shall occur and be
------------------------------
continuing under the terms applicable to:
(i) any Funded Indebtedness or any Indebtedness or items of
Indebtedness of the Company or any of its Subsidiaries (other than under
this Agreement or any other Loan Document) which Funded Indebtedness or
Indebtedness, as the case may be, has an aggregate outstanding principal
amount of $75,000,000 or more, or
(ii) under one or more Interest Rate Contracts of the Company or any
of its Subsidiaries resulting in aggregate net obligations of the Company
and its Subsidiaries of $75,000,000 or more and,
in either of the above cases, such default shall:
(A) consist of the failure to pay such Indebtedness or such net
obligations when due (whether at scheduled maturity, upon early
termination, by required prepayment, acceleration, demand or otherwise)
after giving effect to any applicable grace period; or
(B) result in, or continue unremedied and unwaived for a period of
time sufficient to permit, the acceleration of such Indebtedness or the
early termination of any such Interest Rate Contract;
(f) Bankruptcy or Insolvency. The Company or any Restricted
------------------------
Subsidiary shall:
(i) generally fail to pay, or admit in writing its inability to pay
its debts as they become due (provided, however, that this clause (i) shall
----------------- ----------
not apply to any Subsidiary of the Company designated with an asterisk in
Schedule 5.07);
--------------
(ii) commence a voluntary case or other proceeding seeking
liquidation, reorganization or other relief with respect to itself or its
debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect;
(iii) seek the appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any substantial part of its
property or consent to any such relief or to the
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<PAGE>
appointment of or taking possession by any such official in an involuntary
case or other proceeding commenced against it;
(iv) make a general assignment for the benefit of creditors; or
(v) take any corporate action to authorize any of the foregoing;
(g) Involuntary Proceedings. An involuntary case or other
-----------------------
proceeding shall be commenced against the Company or any Restricted Subsidiary
seeking liquidation, reorganization or other relief with respect to it or its
debts under any bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver, liquidator, custodian
or other similar official of it or any substantial part of its property, and
such involuntary case or other proceeding shall remain undismissed and unstayed
for a period of 60 days; or an order for relief shall be entered against the
Company or any Restricted Subsidiary under the federal bankruptcy laws as now or
hereafter in effect;
(h) Monetary Judgments. One or more judgments or orders for the
------------------
payment of money exceeding in the aggregate $75,000,000 shall be rendered
against the Company or any of its Subsidiaries and either (i) enforcement
proceedings shall have been initiated by any creditor upon such judgment or
order or (ii) such judgment or order shall continue unsatisfied or unstayed for
a period of 30 days;
(i) Pension Plans. Any of the following events shall occur with
-------------
respect to any Pension Plan:
(i) the institution of any steps by the Company, any member of its
Controlled Group or any other Person to terminate a Pension Plan if, as a
result of such termination, the Company or any such member could reasonably
expect to be required to make a contribution to such Pension Plan, or could
reasonably expect to incur a liability or obligation to such Pension Plan
or the PBGC, in excess of $75,000,000; or
(ii) a contribution failure occurs with respect to any Pension Plan
which gives rise to a Lien under Section 302(f) of ERISA with respect to a
--------------
liability or obligation in excess of $75,000,000;
(j) Change in Control. The acquisition by any Person or group
-----------------
(within the meaning of Rule 13d-5 of the Securities and Exchange Commission
under the Securities Exchange Act of 1934), or two or more Persons acting in
concert, of beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Exchange Act of 1934) of
either (i) 33-1/3% or more of the outstanding shares of voting stock of the
Company or (ii) the power to direct or cause the direction of the management and
policies of the Company, whether through the ownership of voting securities, by
contract or otherwise; or
(k) Impairment of Certain Documents. Except as otherwise expressly
-------------------------------
permitted in any Loan Document, any of the Loan Documents shall terminate or
cease in whole or in part to be the legally valid, binding, and enforceable
obligation of the relevant Loan Party, or such Loan Party or
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<PAGE>
any Person acting for or on behalf of any Loan Party, contests such validity,
binding effect or enforceability, or purports to revoke any Loan Document.
9.02 Remedies. If any Event of Default shall have occurred and be
--------
continuing:
(a) The Agent shall at the request of, or may with the consent of,
the Required Lenders, declare the Commitments to be terminated, whereupon
the Commitments shall forthwith be terminated; and/or
(b) The Agent shall at the request of, and may with the consent of,
the Required Lenders, declare the unpaid principal amount of all
outstanding Loans, all interest accrued and unpaid thereon and all other
Obligations payable hereunder or under any other Loan Document to be
immediately due and payable, whereupon the Loans, all such interest and all
such Obligations shall become and be forthwith due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Company; and/or
(c) The Agent shall at the request of, and may with the consent of,
the Required Lenders, exercise all rights and remedies available to it as
Agent under any Loan Document;
provided, however, that upon the occurrence of any Event of Default specified in
- -------- -------
paragraph (f)(ii), (f)(iii) or (g) of Section 9.01 or in the event of an actual
- ----------------- -------- --- ------------
or deemed entry of an order for relief with respect to the Company or any of its
Subsidiaries under any bankruptcy, insolvency or other similar law now or
hereafter in effect, the Commitments shall automatically terminate and the
unpaid principal amount of all outstanding Loans and all interest accrued
thereon and all other Obligations shall automatically become due and payable
without further action of the Agent or any Lender.
ARTICLE X
THE AGENT
---------
10.01 Appointment. Each Lender hereby irrevocably appoints,
-----------
designates and authorizes the Agent to take such action on its behalf under the
provisions of this Agreement and each other Loan Document and to exercise such
powers and perform such duties as are expressly delegated to it by the terms of
this Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere in this Agreement or in any other Loan Document, the Agent
shall not have any duties or responsibilities except those expressly set forth
herein or any fiduciary relationship with any Lender, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist against the
Agent.
10.02 Delegation of Duties. The Agent may execute any of its duties
--------------------
under this Agreement or any other Loan Document by or through its employees,
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties.
10.03 Liability of Agent. Neither the Agent nor any of its
------------------
directors, officers, employees, agents, attorneys-in-fact or Affiliates shall be
(a) liable for any action taken or omitted to
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<PAGE>
be taken by any of them under or in connection with this Agreement or any other
Loan Document (except for its own gross negligence or willful misconduct) or (b)
responsible in any manner to any of the Lenders for any recital, statement,
representation or warranty made by the Company or any of its officers contained
in this Agreement or by any Loan Party or any officer of any thereof in any
other Loan Document or in any certificate, report, statement or other document
referred to or provided for in, or received by the Agent under or in connection
with, this Agreement or any other Loan Document or for the value of any
collateral or the validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Loan Document or for any failure of
the Company or any other Loan Party to perform its obligations hereunder or
thereunder. The Agent shall not be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document or to inspect the properties, books or records of the Company or any of
its Subsidiaries.
10.04 Reliance by Agent. (a) The Agent shall be entitled to rely,
-----------------
and shall be fully protected in relying, upon any writing, resolution, notice,
consent, certificate, affidavit, letter, facsimile, telex or telephone message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons
and upon any advice and statements of legal counsel (including counsel to the
Company), independent accountants and other experts selected by the Agent. The
Agent shall be fully justified in failing or refusing to take any action under
this Agreement or any other Loan Document unless it shall first receive such
advice or concurrence of the Required Lenders as it deems appropriate and, if it
so requests, it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. Except to the extent expressly
provided in Section 11.02, the Agent shall in all cases be fully protected in
-------------
acting, or in refraining from acting, under this Agreement or any other Loan
Document in accordance with a request or the consent of the Required Lenders and
such request or consent and any action taken or failure to act pursuant thereto
shall be binding upon all the Lenders and all future holders of the Loans or any
portion thereof.
(b) For purposes of determining compliance with the conditions
specified in Sections 6.01 and 6.02, each Lender shall be deemed to have
----------------------
consented to, approved or accepted or to be satisfied with each document or
other matter required thereunder to be consented to or approved by or acceptable
or satisfactory to the Lenders unless an officer of the Agent responsible for
the transactions contemplated by the Loan Documents shall have received notice
from such Lender prior to the initial Borrowing specifying its objection thereto
and either such objection shall not have been withdrawn by notice to the Agent
to that effect or such Lender shall not have made available to the Agent such
Lender's Commitment Percentage of such Borrowing.
10.05 Notice of Default. The Agent shall not be deemed to have
-----------------
knowledge or notice of the occurrence of any Default or Event of Default, except
with respect to defaults in the payment of principal, interest and fees payable
to the Agent for the account of the Lenders, unless the Agent shall have
received notice from a Lender or the Company referring to this Agreement or any
other Loan Document, describing such Default or Event of Default and stating
that such notice is a "notice of default". In the event that the Agent receives
such a notice, the Agent shall give notice thereof to the Lenders. The Agent
shall take such action with respect to such Default or Event of Default as shall
be requested by the Required Lenders in accordance with Article IX; provided,
---------- --------
however, that
- -------
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<PAGE>
unless and until the Agent shall have received any such request from the
Required Lenders, the Agent may (but shall not be obligated to) take such
action, or refrain from taking such action, with respect to such Default or
Event of Default as it shall deem advisable in the best interests of the
Lenders.
10.06 Credit Decision. Each Lender expressly acknowledges that
---------------
neither the Agent nor any of its Affiliates nor any director, officer, employee,
agent or attorney-in-fact of any of them has made any representation or warranty
to it and that no act by the Agent hereinafter taken, including any review of
the affairs of the Company and its Subsidiaries, shall be deemed to constitute
any representation or warranty by the Agent to any Lender. Each Lender
represents to the Agent that it has, independently and without reliance upon the
Agent and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
properties, operations or condition, financial or otherwise, and
creditworthiness of the Company and its Subsidiaries and made its own decision
to enter into this Agreement and extend credit to the Company hereunder. Each
Lender also represents that it will, independently and without reliance upon the
Agent and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit analysis, appraisals and decisions
in taking or not taking action under this Agreement, and to make such
investigations as it deems necessary to inform itself as to the business,
prospects, properties, operations or condition, financial or otherwise, and
creditworthiness of the Company and its Subsidiaries. Except for notices,
reports and other documents expressly required to be furnished to the Lenders by
the Agent hereunder, the Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the business,
prospects, properties, operations or condition, financial or otherwise, and
creditworthiness of the Company and its Subsidiaries which may come into the
possession of the Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates.
10.07 Indemnification. The Lenders agree to indemnify the Agent (to
---------------
the extent not reimbursed by or on behalf of the Company and without limiting
the obligation of the Company to do so), ratably according to the respective
amounts of their outstanding Loans, or, if no Loans are outstanding, their
Commitments, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses and disbursements
of any kind whatsoever which may at any time (including at any time after the
repayment of the Loans and all other Obligations) be imposed on, incurred by or
asserted against the Agent in any way relating to or arising out of this
Agreement or any other Loan Document or any document contemplated by or referred
to herein or therein or the transactions contemplated hereby or thereby or any
action taken or omitted by the Agent under or in connection with any of the
foregoing; provided, however, that no Lender shall be liable for the payment to
-------- -------
the Agent of any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
solely from the Agent's gross negligence or willful misconduct. Without
limiting the generality of the foregoing, each Lender agrees to reimburse the
Agent promptly upon demand for its ratable share of any out-of-pocket expenses
and reasonable fees of counsel (including the allocated cost of in-house
counsel) incurred by the Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiation, legal proceedings or otherwise) of, or legal advice in
respect of its or the Lenders' rights or responsibilities under, this Agreement,
any other Loan Document or any document contemplated by or referred to herein to
the extent that the Agent is not reimbursed for such expenses by or on behalf of
the Company.
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<PAGE>
10.08 Agent in Individual Capacity. MSSF and its Affiliates may make
----------------------------
loans to, issue, amend, renew (or participate in) letters of credit for the
account of, accept deposits from, acquire equity interests in and generally
engage in any kind of banking, trust, financial advisory or other business with
the Company and its Subsidiaries and their respective Affiliates as though MSSF
were not the Agent hereunder. With respect to its Loans, MSSF shall have the
same rights and powers under this Agreement as any Lender and may exercise the
same as though it were not the Agent, and the terms "Lender" and "Lenders" shall
------ -------
include MSSF in its individual capacity.
10.09 Successor Agent. The Agent may resign at any time by giving
---------------
written notice thereof to the Lenders and the Company and may be removed at any
time with or without cause by the Required Lenders. Upon any such resignation
or removal, the Required Lenders shall have the right to appoint a successor
Agent which shall be a commercial bank or other financial institution organized,
chartered or licensed under the laws of the United States of America or of any
State thereof having combined capital and surplus of at least $500,000,000. If
no successor Agent shall have been so appointed by the Required Lenders, and
shall have accepted such appointment within 30 days after the notice of
resignation or the removal of the retiring Agent, then the retiring Agent may,
on behalf of the Lenders, with the consent of the Company which consent shall
not be unreasonably withheld or delayed, appoint a successor Agent, which shall
be a commercial bank or other financial institution organized or chartered under
the laws of the United States of America or of any State thereof having a
combined capital and surplus of at least $500,000,000. Upon the acceptance of
any appointment as Agent hereunder by a successor Agent, such successor Agent
shall succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Agent, and the retiring Agent shall be discharged from
its future duties and obligations under this Agreement and the other Loan
Documents. After any retiring Agent's resignation or removal hereunder as Agent,
the provisions of this Article X and Sections 11.04 and 11.05 shall inure to its
--------- -------------- -----
benefit as to any actions taken or omitted to be taken by it while it was Agent
under this Agreement and the other Loan Documents.
10.10 The Arranger. The Arranger, in its capacity as such, shall
------------
have no right, power, obligation, liability, responsibility or duty under this
Agreement other than the right to indemnity under Section 11.05.
-------------
ARTICLE XI
MISCELLANEOUS
-------------
11.01 Notices, Etc. All notices, requests and other communications
------------
provided to any party under this Agreement shall, except as otherwise expressly
specified herein, be in writing (including by facsimile) and mailed by overnight
delivery, transmitted by facsimile or delivered: if to the Company, to its
address specified on the signature pages hereof; if to any Lender, to its
Domestic Lending Office specified opposite its name in Schedule 1.01(b); and, if
----------------
to the Agent, to its address specified on the signature pages hereof; or, as to
the Company or the Agent, at such other address as shall be designated by such
party in a written notice to the other parties and, as to each other party, at
such other address as shall be designated by such party in a written notice to
the Company and the Agent. All such notices and communications shall be
effective, if transmitted by facsimile, when transmitted, or, if mailed by
overnight delivery or delivered, upon delivery, except that (a) notices and
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facsimile communications to the Agent pursuant to Article II or X shall not be
---------- -
effective until received by the Agent and (b) any notice by facsimile to the
Agent must be confirmed by telephone or mail.
11.02 Amendments, Etc. No amendment or waiver of any provision of
---------------
this Agreement or of any other Loan Document, and no consent to any departure by
the Company or any other Loan Party herefrom or therefrom, shall in any event be
effective unless the same shall be in writing and signed by the Required Lenders
and, in the case of amendments, the Company, and then any such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given; provided, however, that
-------- -------
(a) no amendment, waiver or consent shall, unless in writing and
signed by all the Lenders and, in the case of amendments, the Company, do
any of the following:
(i) increase the Commitments of the Lenders (other than by
assignment); provided, however, that any Lender may increase its own
-------- -------
Commitment without the consent of the other Lenders;
(ii) reduce the principal of, or interest (other than under
Section 2.09) on, the Loans or reduce the amount of any fees payable
-------------
hereunder
(iii) postpone any date fixed for any payment of principal of,
or interest on, the Loans or any fees payable hereunder;
(iv) modify any requirement hereunder that any particular
action be taken by all of the Lenders or by the Required Lenders or
change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Loans which shall be required for the Lenders
or any of them to take any action hereunder;
(v) terminate the Subsidiary Guaranty;
(vi) amend or waive the provisions of Section 6.01 or 6.02; or
--------------------
(vii) amend this Section 11.02;
-------------
(b) no amendment, waiver or consent which affects the rights or
duties of the Agent under this Agreement or any other Loan Document shall
become effective unless signed by the Agent in addition to the Lenders
required above to take such action; and
11.03 No Waiver; Remedies. No failure on the part of any Lender or
-------------------
the Agent to exercise, and no delay in exercising, any right, remedy, power or
privilege hereunder or under any other Loan Document shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right, remedy,
power or privilege preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
11.04 Costs and Expenses. The Company agrees to pay on demand:
------------------
-50-
<PAGE>
(a) all out-of-pocket costs and expenses incurred by the Agent in
connection with the preparation, execution, delivery, administration,
modification and amendment of the Loan Documents and any other document to
be delivered hereunder or thereunder or in connection with the transactions
contemplated hereby or thereby, including the out-of-pocket expenses and
reasonable fees of counsel for the Agent (including local counsel which may
be retained by the Agent and the allocated cost of in-house counsel) with
respect thereto and with respect to advising the Agent as to its rights and
responsibilities under the Loan Documents;
(b) all out-of-pocket costs and expenses incurred by the Agent or
any Lender in connection with the preservation of any rights under any Loan
Document or in connection with any restructuring or "work-out" of any of
the Obligations (whether through negotiations, legal proceedings or
otherwise), including the out-of-pocket expenses and reasonable fees of
counsel for the Agent (including the allocated cost of in-house counsel);
(c) all out-of-pocket costs and expenses incurred by the Agent or
any Lender in connection with the enforcement of any of the Obligations,
including the out-of-pocket expenses and reasonable fees of counsel for the
Agent or such Lender (including the allocated cost of in-house counsel);
(d) all out-of-pocket costs and expenses incurred by the Agent in
connection with due diligence, transportation, use of computers,
duplication, search reports and all filing and recording fees; and
(e) to each Lender being replaced pursuant to Section 4.09, the
------------
reasonable out-of-pocket expenses and reasonable fees of counsel (including
the allocated cost of in-house counsel) not exceeding $5,000 in connection
with such replacement.
11.05 Indemnity. (a) The Company agrees to indemnify and hold
---------
harmless the Agent, the Arranger and each Lender and each of their Affiliates
and all directors, officers, employees, agents and advisors of all of the
foregoing (each, an "Indemnified Party") from and against any and all claims,
-----------------
actions, proceedings, suits, damages, losses, liabilities, costs, expenses and
disbursements, including the out-of-pocket expenses and reasonable fees of
counsel (including the allocated cost of in-house counsel) which may be incurred
by or asserted against any Indemnified Party as a result of any investigation,
litigation, suit, action or proceeding (regardless of whether an Indemnified
Party is a party thereto) arising out of, relating to, or in connection with
this Agreement, any other Loan Document or any transaction or proposed
transaction (whether or not consummated) financed or to be financed, in whole or
in part, directly or indirectly, with the proceeds of any Loan (other than costs
of the type covered by Section 11.04) or any other transaction contemplated
-------------
hereby; except to the extent such claim, damage, loss, liability, cost or
expense has resulted primarily from such Indemnified Party's gross negligence or
willful misconduct as determined by a final judgment of a court of competent
jurisdiction. Notwithstanding any other provision contained in this Agreement,
this indemnity shall not be limited in any way by the passage of time or the
occurrence of any event.
(b) The Agent, the Arranger and each Lender agree that in the event
that any investigation, litigation, suit, action or proceeding is asserted or
threatened in writing or instituted against it or any other Indemnified Party,
or any remedial, removal or response action is requested of it or any other
Indemnified Party, for which the Agent, the Arranger or any Lender may desire
-51-
<PAGE>
indemnity or defense hereunder, the Agent, the Arranger or such Lender shall
promptly notify the Company thereof in writing and agree, to the extent
appropriate, to consult with the Company with a view to minimizing the cost to
the Company of its obligations under this Section 11.05. The Company will not
-----
be required to pay the fees and expenses of more than one counsel for the
Indemnified Parties unless the employment of separate counsel has been
authorized by the Company, or unless any Indemnified Party reasonably concludes
that there may be defenses available to it which are not available to the other
Indemnified Parties or that there is a conflict between its interests and those
of the other Indemnified Parties.
(c) No action taken by legal counsel chosen by the Agent, the
Arranger or any Lender in defending against any such investigation, litigation,
suit, action or proceeding or requested remedial, removal or response action
shall vitiate or in any way impair the obligations and duties of the Company
hereunder to indemnify and hold harmless each Indemnified Party; provided,
--------
however, that if the Company is required to indemnify any Indemnified Party
- -------
pursuant hereto, neither the Agent nor the Arranger nor any Lender will settle
or compromise any such investigation, litigation, suit, action or proceeding
without the prior written consent of the Company (which consent shall not be
unreasonably withheld or delayed) so long as the Company has provided evidence
reasonably satisfactory to the Agent, the Arranger or such Lender that the
Company and its Subsidiaries on a consolidated basis do not at such time have a
negative Net Worth.
11.06 Right of Set-off. Upon the occurrence and during the
----------------
continuation of any Event of Default, each Lender is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits in whatever currency (general or special, time or
demand, provisional or final) at any time held and other indebtedness at any
time owing by such Lender to or for the credit or the account of the Company
against any and all of the Obligations, whether or not such Lender shall have
made any demand under this Agreement. Each Lender agrees promptly to notify the
Company after any such set-off and application made by such Lender; provided,
--------
however, that the failure to give such notice shall not affect the validity of
- -------
such set-off and application. The rights of each Lender under this Section
-------
11.06 are in addition to any other right or remedy (including any other right of
- -----
set-off) which such Lender may have under applicable law or under any Loan
Document.
11.07 Binding Effect. This Agreement shall become effective when a
--------------
counterpart hereof shall have been executed by the Agent and counterparts hereof
executed by the Company and each Lender shall have been received by the Agent
and notice thereof shall have been given by the Agent to the other parties
hereto and thereafter shall be binding upon and inure to the benefit of the
Company, the Agent and each Lender and their respective successors and assigns;
provided, however, that (a) except as permitted under clause (b)(ii) of Section
- ----------------- -------------- -------
8.03, the Company may not assign or transfer its rights or obligations hereunder
- ----
without the prior written consent of all the Lenders and (b) the rights of
assignment and transfer of the rights and obligations of the Lenders hereunder
are subject to the provisions of Section 11.08.
-------------
11.08 Assignments, Participations, Etc. (a) (i) After July 31,
---------------------------------
1999, any Lender may with the prior consent of the Company (which will not be
unreasonably withheld, although no such consent shall be required if an Event of
Default has occurred and is continuing) at any time assign to one or more
commercial banks or other financial institutions all or any fraction of its
Commitment (if
-52-
<PAGE>
not theretofore terminated) and outstanding Loans (on a ratable basis) in a
minimum amount of $25,000,000 and in multiples of $1,000,000 in excess thereof
or, if its Commitment or outstanding Loans is less than
$25,000,000, in the amount of its Commitment or its outstanding Loans.
(ii) Any Lender may without the prior consent of the Company assign
to another Lender all or any fraction of its Commitment (if not theretofore
terminated) and outstanding Loans (on a ratable basis) in a minimum amount of
$5,000,000 and in multiples of $1,000,000 in excess thereof or, if the
Commitment or outstanding Loans is less than $5,000,000, in the amount of its
Commitment or its outstanding Loans.
(iii) Any Lender may at any time assign all or any portion of its
rights under this Agreement and any note issued pursuant to Section 2.03 to a
------------
Federal Reserve Bank; provided, however, that no such assignment shall release
-------- --------
any Lender from its obligations hereunder.
(iv) Any Lender, if so requested by the Company under Section 4.09,
------------
shall assign to another bank or other financial institution its entire
Commitment and all outstanding Loans.
(b) No assignment shall become effective, and the Company and the
Agent shall be entitled to continue to deal solely and directly with each Lender
in connection with the interests so assigned by such Lender to an Assignee,
until (i) written notice of such assignment, together with an agreement to be
bound, payment instructions, addresses and related information with respect to
such Assignee, shall have been given to the Company and the Agent by such Lender
and such Assignee, in substantially the form of Exhibit 11.08 (a "Notice of
------------- ---------
Assignment"), and such Lender and such Assignee shall have executed in
- ----------
connection therewith an Assignment and Assumption Agreement substantially in the
form of Attachment A to such Notice of Assignment, (ii) a processing fee in the
------------
amount of $3,500 (provided, however, that in case of an assignment by a Lender
-------- -------
to another Lender, such fee shall be in the amount of $1,000 and, in the case of
an assignment by a Lender to one of its Affiliates, no processing fee shall be
payable) shall have been paid to the Agent by the assignor Lender or the
Assignee, and (iii) either (A) five Business Days shall have elapsed after
receipt by the Agent of the items referred to in clauses (i) and (ii) or (B) if
----------- ---- ---
earlier, the Agent has notified the assignor Lender and the Assignee of its
receipt of the items mentioned in clauses (i) and (ii) and that it has
----------- ----
acknowledged the assignment by countersigning the Notice of Assignment.
(c) From and after the effective date of any assignment hereunder,
(i) the Assignee thereunder shall be deemed automatically to have become a party
hereto and, to the extent that rights and obligations hereunder have been
assigned to such Assignee by the assignor Lender, shall have the rights and
obligations of a Lender hereunder and under each other Loan Document, and (ii)
the assignor Lender, to the extent that rights and obligations hereunder have
been assigned by it to the Assignee, shall be released from its future
obligations hereunder and under each other Loan Document.
(d) Any Lender may at any time sell to one or more financial
institutions or other Persons (each of such Persons being herein called a
"Participant") participating interests in any of the Loans, its Commitment or
-----------
other interests of such Lender hereunder; provided, however, that
-----------------
(i) no participation contemplated in this Section 11.08(d) shall
----------------
relieve such Lender from its Commitment or its other obligations hereunder
or under any other Loan Document;
-53-
<PAGE>
(ii) such Lender shall remain solely responsible for the performance
of its Commitment and such other obligations;
(iii) the Company and the Agent shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and each other Loan Document; and
(iv) no Participant, unless such Participant is an Affiliate of such
Lender, shall be entitled to require such Lender to take or refrain from
taking any action hereunder or under any other Loan Document, except that
such Lender may agree with any Participant that such Lender will not,
without such Participant's consent, take any action of the type described
in the Section 11.02.
-------------
The Company acknowledges and agrees that each Participant, for
purposes of Section 3.05, 3.06, 4.02, 4.03, 4.05, 4.06 or 11.06, shall be
------------------------------------------ -----
considered a Lender; provided, however, that for purposes of Sections 3.05,
-------- ------- --------------
4.02, 4.03, 4.05 and 4.06, no Participant shall be entitled to receive any
- ---------------- ----
payment or compensation in excess of that to which such Participant's selling
Lender would have been entitled with respect to the amount of such Participant's
participation interest if such Lender had not sold such participation interest.
11.09 Confidentiality. Each Lender agrees that all nonpublic
---------------
information provided to it by the Company or by the Agent on behalf of the
Company in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby or thereby will be held and treated by such
Lender, its agents, directors, Affiliates, officers and employees in confidence
and further agrees and undertakes that neither it nor any of its Affiliates
shall use any such information for any purpose or in any manner other than
pursuant to the terms contemplated by this Agreement or relating to other
business transactions between the Company and such Lender. Any Lender may
disclose such information (a) at the request of any bank or other governmental
regulatory authority or in connection with an examination of such Lender by any
such authority or examiner; (b) pursuant to subpoena or other court process; (c)
when required to do so in accordance with the provisions of any applicable law;
(d) at the written request or the express direction of any other agency of any
State of the United States of America or of any other jurisdiction in which such
Lender conducts its business; and (e) to such Lender's independent auditors,
counsel and other professional advisors. Notwithstanding the foregoing, the
Company authorizes each Lender to disclose to any Participant or Assignee and
any prospective Participant or Assignee such financial and other information in
such Lender's possession concerning the Company or its Subsidiaries which has
been delivered to the Lenders pursuant to this Agreement or any other Loan
Document or which has been delivered to the Lenders by the Company in connection
with the Lenders' credit evaluation of the Company and its Subsidiaries prior to
entering into this Agreement; provided that such Participant or Assignee or
prospective Participant or Assignee agrees in writing to such Lender to keep
such information confidential to the same extent as required of the Lenders
hereunder.
11.10 Survival. The obligations of the Company under Sections 3.05,
-------- --------------
4.02, 4.03, 4.05, 4.06, 11.04 and 11.05, and the obligations of the Lenders
- ----------------------------- -----
under Sections 3.05(j) and 10.07, shall in each case survive the repayment of
---------------- -----
the Loans and all other Obligations and the termination of this Agreement and
the Commitments; provided, however, that no request for reimbursement pursuant
-------- -------
to
-54-
<PAGE>
such Sections (other than Sections 11.04(b) and (c) and 11.05) may be made
----------------- --- -----
more than six months after the termination of this Agreement and the Commitments
and the repayment of all Loans and all other Obligations. The representations
and warranties made by the Company in this Agreement and by each Loan Party in
each other Loan Document shall survive the execution and delivery of this
Agreement and such other Loan Document.
11.11 Severability. Any provision of this Agreement or any other
------------
Loan Document which is prohibited or unenforceable in any jurisdiction shall, as
to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this Agreement
or affecting the validity or enforceability of such provision in any other
jurisdiction.
11.12 Headings. The various headings of this Agreement are inserted
--------
for convenience only and shall not affect the meaning or interpretation of this
Agreement or any provisions hereof.
11.13 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
-------------
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
11.14 Execution in Counterparts. This Agreement may be executed in
-------------------------
any number of counterparts and by different parties hereto on separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
11.15 ENTIRE AGREEMENT. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
----------------
EMBODY THE ENTIRE AGREEMENT AND UNDERSTANDING AMONG THE COMPANY, THE LENDERS AND
THE AGENT AND SUPERSEDE ALL PRIOR OR CONTEMPORANEOUS AGREEMENTS AND
UNDERSTANDINGS OF SUCH PERSONS, VERBAL OR WRITTEN, RELATING TO THE SUBJECT
MATTER HEREOF EXCEPT FOR THE FEE LETTER AND ANY PRIOR ARRANGEMENTS MADE WITH
RESPECT TO THE PAYMENT BY THE COMPANY OF (OR ANY INDEMNIFICATION FOR) ANY FEES,
COSTS OR EXPENSES PAYABLE TO OR INCURRED (OR TO BE INCURRED) BY OR ON BEHALF OF
THE AGENT OR THE LENDERS.
11.16 WAIVER OF JURY TRIAL. EACH OF THE AGENT, THE LENDERS AND THE
--------------------
COMPANY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY
HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING
OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT.
THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENT AND THE LENDERS ENTERING
INTO THIS AGREEMENT.
* * *
-55-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
GEORGIA-PACIFIC CORPORATION
By_____________________________
Name:
Title:
133 Peachtree Street, N.E.
Atlanta, Georgia 30303
Attention: Vice President and Treasurer
Facsimile No.: (404) 230-5598
MORGAN STANLEY SENIOR FUNDING, INC.,
Individually and as Agent, Lead Arranger and Book
Manager
By_____________________________
Name:
Title:
1585 Broadway
New York, New York 10036
Attention: James Morgan
Facsimile No.: (212) 761-0592
with a copy to:
1585 Broadway
New York, New York 10036
Attention: Michael McLaughlin
Facsimile No.: (212) 761-0322
-56-
<PAGE>
SCHEDULE 1.01(a)
----------------
COMMITMENTS
-----------
Lender Commitment Commitment Percentage
- ------ ---------- ---------------------
Morgan Stanley Senior Funding, Inc. $1,000,000,000 100%
<PAGE>
SCHEDULE 1.01(b)
----------------
LENDING OFFICES
---------------
<TABLE>
<CAPTION>
Lender Domestic Lending Office Eurodollar Lending Office
- ------ ----------------------- -------------------------
<S> <C> <C>
Morgan Stanley Senior 1585 Broadway 1585 Broadway
Funding Inc. New York, NY 10036 New York, NY 10036
Attention: James Morgan Attention: James Morgan
Facsimile No.: (212) 761-0592 Facsimile No.: (212) 761-0592
</TABLE>
<PAGE>
Exhibit 2.02
to Credit Agreement
FORM OF NOTICE OF BORROWING
Morgan Stanley Senior Funding, Inc.
1585 Broadway
New York, New York 10036
Attention: James Morgan
Re: Georgia-Pacific Corporation Credit Agreement
dated as of June 30, 1999
--------------------------------------------
Ladies and Gentlemen:
This Notice of Borrowing is delivered to you pursuant to Section
-------
2.02(a) of the Credit Agreement, dated as of June 30, 1999 (together with all
- -------
amendments, if any, from time to time made thereto, the "Credit Agreement"),
----------------
among GEORGIA-PACIFIC CORPORATION, a Georgia corporation (the "Company"), the
-------
Lenders party thereto, and MORGAN STANLEY SENIOR FUNDING, INC., as agent (the
"Agent"), and as Lead Arranger and Book Manager. Unless otherwise defined
- ------
herein or the context otherwise requires, terms used herein have the meanings
provided in the Credit Agreement.
The Company hereby requests that a Borrowing of Loans be made in
the aggregate principal amount of $________________ on ______________, 1999
comprised of [Eurodollar Loans having an Interest Period of_________________
months] [Reference Rate Loans].
The Company hereby certifies and warrants that on the date the
Borrowing requested hereby is made (both before and after giving effect to the
making of the Borrowing and after giving effect to the application, directly or
indirectly, of the proceeds thereof):
(a) the representations and warranties contained in Article V of
---------
the Credit Agreement are true and correct on and as of such date as though
made on and as of such date (except for representations and warranties
relating solely to a particular point in time, which shall be true and
correct as of such point in time);
(b) no Default or Event of Default has occurred and is
continuing; and
(c) the proceeds of the Borrowing hereby requested are being or
will be used in accordance with Section 7.01 of the Credit Agreement.
------------
The Company agrees that if prior to the time of the Borrowing
requested hereby any matter certified to herein by it will not be true and
correct at such time as if then made, it will
<PAGE>
Exhibit 2.02
Page 2
immediately so notify the Agent. Except to the extent, if any, that prior to the
time of the Borrowing requested hereby the Agent shall receive written notice to
the contrary from the Company, each matter certified to herein shall be deemed
once again to be certified as true and correct at the date of such Borrowing as
if then made.
Please wire transfer the proceeds of the Borrowing requested hereby to
the accounts of the following Persons at the financial institutions indicated
respectively:
<TABLE>
<CAPTION>
Amount to be Person to be Paid Name, Address, Etc.
-----------------
Transferred Name Account No. of Transferee
- ----------- ---- ----------- -------------
<S> <C> <C> <C>
$____________ ___________ ________ _________________________________
_________________________________
Attention:_______________________
$____________ ___________ ________ _________________________________
_________________________________
Attention:_______________________
$____________ ___________ ________ _________________________________
_________________________________
Attention:_______________________
Balance of
such Proceeds: The Company _____________ _________________________________
Attention:_______________________
</TABLE>
The Company has caused this Notice of Borrowing to be executed and
delivered, and the certification and warranties contained herein to be made, by
its duly authorized officer this day of ____________________, 1999.
GEORGIA-PACIFIC CORPORATION
By:__________________________________________
Title:_______________________________________
